1976 (1) TMI 8

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....nt assessment ? " The assessee was the sole selling agent of Messrs. Elgin Mills Company Ltd. and Messrs. Kanpur Textiles Ltd. In the accounting year corresponding to the assessment year 1959-60, the assessee claimed a deduction of Rs. 3,00,114 as bad debt. The basis of the claim were these. An amount of Rs. 3,00,114 was advanced by the assessee to Sri Brahmaputra Tea Company (India) Ltd. on September 13, 1957. In the immediately preceding year, the assessee had advanced an amount of Rs. 2,50,000 to Messrs. S. B. Industrial Development Company (P.) Ltd., Calcutta, and Rs. 50,000 to Messrs. F. & Cosier (India), Calcutta, and a further amount of Rs. 5,40,000 to this party. These amounts were claimed as bad debts in the assessment year 1958....

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....vance could be treated as having been made for money-lending purposes. It was pointed out that in the year 1962-63, the assessee received an income of Rs. 1,41,863 which was taxed and it also paid interest at Rs. 2,58,083 which was debited in the books. The Tribunal found that although under the memorandum of association, the assessee could start money-lending, it had not been shown that before advancing that money, the assessee had passed any resolution authorising it to start such business, and neither had the assessee obtained any licence for carrying on money-lending business, and hence it could not be held that the money was advanced during the course of such money-lending business. It also held that there was nothing on the record to ....