B.D. BHARUCHA,BOMBAY vs COMMISSIONER OF INCOME-TAX, CENTRAL BOMBAY

The Supreme Court ruled that the loss incurred by the appellant, who financed film distributors, was a revenue loss and not a capital loss under Section 10(2)(xi) of the Income-tax Act, 1922. The Court emphasized that losses related to the running of a business should be classified as revenue losses, particularly when the debt was incidental to the business operations. The Court held that the appellant was entitled to claim the deduction for the irrecoverable amount as a bad debt, overturning the decisions of the lower authorities.