1984 (12) TMI 15

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....e Tribunal has referred the following questions of law under section 256(1) of the Income-tax Act, 1961 : "(1) Whether, on the facts and in the circumstances of the case, the Tribunal was justified in law in determining that the assessee was not entitled to set off the loss arising on the confiscation of the gold against the income brought to tax in respect of such gold, under section 69A of th....

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....d by the Tribunal. Before the Tribunal, the argument advanced on behalf of the assessee was that Rs. 14,500 should be considered as a loss arising out of the confiscation of the gold and should be set off against the assessed income in respect of the gold. In that connection, a decision of the Punjab and Haryana High Court in CIT v. Piara Singh [1972] 83 ITR 678 was cited. The Tribunal did not ....

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....as an allowable deduction." The Tribunal, however, held: "..... The evidence on record itself shows that both the assessee and Ramaiah Setty were dealing in smuggled gold and that they have dealings with each other . . ." It is now not in dispute that the assessee was engaged in smuggling activities and was dealing in smuggled gold. The decision of the Punjab and Haryana High Court on whi....

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..... " While reaching the above conclusion, the Supreme Court has disapproved the ratio of the decision of the Bombay High Court in J S. Parkar v. V B. Palekar [1974] 94 ITR 616 on which the Tribunal has placed reliance. In view of the decision of the Supreme Court in Piara Singh's case [1980] 124 ITR 40, the assessee's claim for set off cannot be denied at all. He was dealing in smuggled gold ....