1982 (4) TMI 26

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....HAR J.-The assessee-firm is doing wholesale business in " kirana " (grains and provisions). It is a partnership firm having five partners. The dispute relates to the assessment year 1970-71. In that year, one of the partners of the firm, Lalchand Khanduram, was carrying a cash balance of the firm amounting to Rs. 20,000 from the shop to his home for safe custody at night, on his scooter. The bag c....

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.... Rs. 20,000 as loss incidental to the business for the assessment year 1970-71 ? " This question is governed by the ratio of the decision of the Supreme Court in the case of Ramchandar Shivnarayan v. CIT [1978] 111 ITR 263. In that case the Supreme Court held that if there is a direct and proximate nexus between the business operation and the loss or where the loss is incidental to the business....

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....resent case, the Tribunal has held that the assessee-firm had a large daily turnover and it was required to keep a large cash amount in the shop during the course of its business. Since such an amount was being carried home by one of the partners for safe custody during the night when it was lost, the loss was incidental to the business operations of the assessee. In view of the facts in this case....