Law: Income Tax Act, 1922

Section: 22,22A,24(1),10

(a) Income-tax Act (XI of 1922)---S. 22-A-Appeal, maintainability of-Appeal not altogether based for non-payment of taxes-Flaws like non-payment of taxes could be cured before date of hearing of appeal-Appeal in case of taxes being not paid could only be termed as late-Appellate authority however empowered to condone delay in filing appeal-Appeal admitted and heard-Conclusion irresistible of delay having been condoned. I. T. A. 311 of 1974-75 ; (1961) 4 Taxation 51 and (1964) 9 Taxation 13 (Trib.) ref. (b) Income-tax Act (XI of 1922)--- ------S. 24(1), Explanation=Transactions resulting in deficit settled without delivery-Nothing but speculation transactions-Calling such losses as hedging losses inadvertently Cannot change real nature of transactions. (c) Income-tax Act (XI of 1922)--- ----S. 10-Bad debts-Allowance of--Bad debts disallowed on ground of no legal action, having been taken for 'their recovery-Such debts being petty remissions legal proceedings for recovery whereof likely to cost more than amount of debts to be recovered, and such remis­sions being incidental to business, such debts, being trade debts, held, could not be disallowed on ground stated. ORDER M. T. SIDDIQUI (PRESIDENT).-These two cross appeals will be disposed of by the same order in view of the identical nature of facts from which the same arise. 2. The assessee-firm carries on ginning and crushing business. A preliminary objection was set up by the D. R. on the ground that the appeal before the A. A. C. was not competent as taxes were not paid as required under section 22-A of the Income-tax Act and the learned A. A. C. was not justified in entertaining and deciding the appeal even though the taxes were paid before the appeal was heard. A perusal of the records shows that the demand notice was served on 14-2-1977 and the appeal was lodged before the A. C. in time on 16-3-1977. Before the A. A. C. also this preliminary objection was raised regarding the late filing of the appeal. The A. R. of the assessee-appellant, however, explained to the learned A. A. C. that the taxes were paid before the date of hearing and in this connection relied on a decision of the Tribunal in I. T. A. No.…

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