COMMISSIONER OF INCOME TAX Vs. BAJRANGLAL DWARKA PRASAD

JUDGEMENT

(1.) THIS is an income-tax reference under Section 256 of the Income-tax Act, 1961, at the instance of the Revenue and the following two questions of law have been referred by the Tribunal to this court for answer, which read as under :

(2.) THE assessee is a registered firm and it deals in money-lending business. A theft took place at the house of the assessee in the intervening night of November 2 and 3, 1978, and pawned silver ornaments of the value of Rs. 1,32,559 and cash of Rs. 2,000 were taken away. It is submitted that in order to redeem the ornaments, a sum of Rs. 27,120 was paid. THE issue relates to the assessment year 1980-81, at the accounting period ending Diwali, 1979. THE Income-tax Officer did not entertain the claim since the revised return of loss was beyond the period prescribed by Section 139(3) of the Income-tax Act. THErefore, he held that the revised return is not valid. He also held that the ornaments were kept by the assessee as security and there was no responsibility on the assessee of returning their ornaments. THErefore, he disallowed the claim of loss of ornaments to the tune of Rs. 1,32,559. He, however, allowed the loss of Rs. 2,000 and so also the deduction of Rs. 27,120.

(3.) WE have heard learned counsel for both the parties and perused the records.