You're not in a loop. The basic idea is that you're supposed to take an undeveloped photo ("Spirit Evidence") from Bruin Tram to Arjun, then take the developed photo ("photo of Bruin") back to Bruin.
- Note: The description of the Spirit Evidence item is wrong in many versions of the game. It says that "Bruin Tram needs this now" but that's not right--Bruin gave it to you! Arjun is the one who needs it, but he may not need it right now. Arjun will ask for it when you progress his storyline far enough.
Bruin gave you the Spirit Evidence item at the same time he asked for a photo from Arjun, so if you don't have it in your backpack or storage then it probably fell on the ground. If so, it's most likely somewhere near Bruin since the most common way things fall on the ground is if you receive them while your backpack is full.