Sec 41(1)
This query is : Resolved
26 March 2014
Bad recovery by successor is not considered as an income under the head PGBP p.k kaimal case. But sec 41(1) clause b clearly states that any trading loss incurred by the first person and recovered by the successor shall be considered as his income. Why then bad debt recovery not considered as income for the successor?
26 March 2014
The intention of the legislature contained in section 41(4) is the identity of the predecessor and successor should be one and the same.
In the cited case, the predecessor was a partnership firm (M/s. Thirumani Pictures) whereas the successor is Mr P.K.Kaimal, the then partner of the dissolved firm.
So Madras high court distinguished the case with section 41(4).
In the cited case, the predecessor was a partnership firm (M/s. Thirumani Pictures) whereas the successor is Mr P.K.Kaimal, the then partner of the dissolved firm.
So Madras high court distinguished the case with section 41(4).
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