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CASE NO.:

Appeal (civil) 2830 of 2007

PETITIONER:

Assistant Commissioner of Income Tax

RESPONDENT:

Rajesh Jhaveri Stock Brokers Pvt. Ltd.

DATE OF JUDGMENT: 23/05/2007

BENCH:

Dr. ARIJIT PASAYAT & D.K. JAIN

JUDGMENT:

J U D G M E N T

CIVIL APPEAL NO. 2830 OF 2007

(Arising out of S.L.P. (C) No.24482 of 2005)

Dr. ARIJIT PASAYAT, J.

1. Leave granted.

2. Challenge in this appeal filed by the revenue is to the

correctness of the decision rendered by a Division Bench of the

Gujarat High Court allowing the Special Civil Application filed

by the appellant.

3. Background facts in a nutshell are as follows:

4. The respondent-a Private Limited Company filed its

return of income for Assessment year 2001-02 on 30th

October, 2001 declaring total loss of Rs.2,70,85,105/-. The

said return was processed under Section 143(1) of the Income

Tax Act, 1961 (in short the \021Act\022) accepting the loss returned

by the respondent. Notice under Section 148 of the Act was

issued on the ground that claim of bad debts as expenditure

was not acceptable. On 12th May, 2004 a return of income

declaring the loss at the