(1.) THIS is a reference under Section 256(1) of the Income-tax Act, 1961 (hereinafter referred to as "the Act"), on the following two questions of law :
(2.) THE facts relevant for each of the two questions are distinct and separate and therefore for the purpose of giving opinion on them, I would like to mention the facts separately.
(3.) THE question with regard to the admissibility of loss by theft in computing the profits of business has to be determined on the facts and circumstances of each case. It cannot be predicated as a rule that all such losses were capital or non-business loss or that all such losses were deductible in computing the business profits. In the instant case the three undisputed facts are : (i) the assessee carried on business in cotton piece goods on wholesale basis; (ii) the sum of Rs. 10,500 represented the cash balance of the day; and (iii) as a result of theft in the shop premises that amount was lost.