If I have three type of income:
1. income from house property
2. income from business or profession
3. income from other sources
In income from other sources i have FD income.
& if bank is dissolved & we did not get the amt invested as well as interest
then whether that loss is carried forward or set off
If income from business icludes income from FD then the ans. will different?
Is any case law is available for the same?
2 Replies
Late CA Sampat Jain
(Chartered Accountant)
(4772 Points)
Replied 26 September 2007
IF THE AMOUNT CAN BE WRITTTEN OFF AS BAD DEBT , then only the benefit of loss will be avaiable .Otherwise it will be a capital loss.
Debt’ must have arisen as an incident of assessee’s business - A debt is allowable only when it is a debt and arises out of and is an incident to the trade. Except in money-lending trade, debts can only be so described if they are due from customers for goods supplied or are loans to constituents of transactions of a similar kind. In every case, the test is, was the debt due as an incident to the business? If it is not of that character it will be a capital loss - CIT v. Abdullabhai Abdulkadar [1961] 41 ITR 545 (SC)/Roop Narain Ram Chandra v. Addl. CIT [1978] 112 ITR 890 (All.)/CIT v. Harjasmal Mehra [1971] 79 ITR 213 (Punj. & Har.)/CIT v. S.R.Subramanya Pillai [1950] 18 ITR 85 (Mad
CMA Gul S
(Program Manager)
(5910 Points)
Replied 26 September 2007
You can write off this as a BAD Debt
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