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1 - 3 of 3 (0.18 seconds)The Commissioner Of Income-Tax, ... vs Shantilal Punjabhai on 1 October, 1964
4. There is a thin line that divides what is to be termed as "speculative transaction" as envisaged by Sub-section (5) of Section 43 of the Income-tax Act, 1961 (hereinafter referred to as "the Act"), and payment made under a settlement which falls outside its ambit. The Supreme Court had occasion to consider this matter in CIT v. Shantilal P. Ltd. [1983] 144 ITR 57, where it was held ; "A transaction cannot be described as a 'speculative transaction' within the meaning of Sub-section (5) of Section 43 of the Income-tax Act, 1961, where there is a breach of the contract and on a dispute between the parties, damages are awarded as compensation by an arbitration award". It was further observed (at p. 60) : "The award of damages for the breach of a contract is not the same thing as a party to the contract accepting satisfaction of the contract otherwise than in accordance with the original terms thereof."
Commissioner Of Income-Tax vs Maya Ram Jia Lal on 18 October, 1985
5. A similar view was taken by our court in CIT v. Maya Ram Jia Lal [1986] 162 ITR 520, where it was held that "if the dispute is settled between the parties, then it is not a 'speculative transaction', but if the contract is settled and under the settlement of the contract, damages are paid, it would be a 'speculative transaction'".
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