1960 (12) TMI 3 - SUPREME COURT

Whether the acquisition of the managing agency of the Dawn Mills Co. Ltd. was in the nature of a 'business' carried on by the assessee-ccompany ?

Whether the loss suffered by the assessee-company of ₹ 1,78,438 on purchase and sale of 400 shares of the Dawn Mills Co. Ltd., being incidental to its business of acquiring the managing agency, was a loss of a revenue nature ?

Held that:- The High Court was right in holding that the acquisition of the managing agency was an acquisition of a capital asset and the loss incurred by sale of the 400 shares was of a capital nature. The High Court was also right in dismissing the notice of motion for an order directing the Tribunal to refer the question suggested by the appellants. If the acquisition of the shares was not acquisition of a stock-in-trade, but of a capital asset, the appellants, by valuing the shares at cost or market price whichever was lower, could not bring the difference between the purchase price and the valuation made by them into their trading account. Appeal dismissed.