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1949 (12) TMI 41
... ... ... ... ..... n that there was a partnership which was resident in British India and that its income was liable to assessment in British India, still the Income Tax Officer having taken action within the period of four years of the end of that year, the assessment on the firm was justified under Section 34, Income Tax Act. We do not think there is any room whatever for the argument advanced on behalf of the assessee that there has been no honest exercise of the Income Tax Officer's judgment in the present case, that he must be fixed....... + More
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1949 (12) TMI 36
... ... ... ... ..... d Judges of the Nagpur High Court state that the widow would be the manager of the joint Hindu family if her sons happened to be minors at the time of the death of her husband. She would be the guardian of her minor sons till the eldest of them attains majority but she would not be the manager of the joint family for she is not a coparcener. If she were the manager then she should continue to be the manager for her life notwithstanding her sons' attainment of majority. It is ages since Hindu society, excepting certain ....... + More
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1949 (12) TMI 34
... ... ... ... ..... he extent the family assets have been actually partitioned or taken away from the family and allotted exclusively to the individual members, those assets cannot be considered to be the assets of the artificial joint family created by Section 25A (3). Nor could that joint family be assessed to income-tax under Section 25A(2) on the income derived from such assets. Authority in support of the above conclusions will be found in the decisions of the Privy Council in Sundar Singh Majithia's case (supra) and of the High Cour....... + More
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1949 (12) TMI 33
... ... ... ... ..... thin Section 42 of the Act but not by Section 4 or 4A(c)(b) of the Act. Income-tax is not like an excise duty levied upon a manufacturer or producer in respect of the commodity produced or manufactured. It is not a tax on goods or even on the sale proceeds of goods like a sales tax Governor-General in Council v. Province of Madras 1945 1 M.L.J. 225, 228 (P.C.). It is a tax upon profits which arise only on sales. Profits on coming into existence attract tax at that point Pondicherry Railway Co.'s case 1932 I.L.R. 54 Mad....... + More
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1949 (12) TMI 32
... ... ... ... ..... see in fact received nothing at all. The mills were sold at a price a long way below the sum owed to the debenture-holders. The Court considered it equitable to relieve the debenture-holders of the payment of auctioneer's commission, the auctioneer being one of the debenture-holders. In the circumstances it would be unreasonable to regard the relief to the debenture-holders as income........... In any event it did not arise out of any business or exercise of vocation or occupation and it was of a casual or non-recurrin....... + More
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1949 (12) TMI 31
... ... ... ... ..... ) are assessable to Indian Income-tax is erroneous. I answer the second question referred to us in the affirmative. The answer to the third question is also in the affirmative. Prices fluctuate in the cotton, woollen and silk markets. The raw produce also differs considerably in quality and in its adaptability to different types of goods. Considerable experience and skilful judgment are necessary if suitable raw materials at favourable market rates are to be selected and purchased, and this is what the agents are doing fro....... + More
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1949 (11) TMI 18
... ... ... ... ..... nprofitable and was stopped permanently or for a time, the effect of that was not to make the business of the assessees different from what it was previously. The assessees might resume the traffic in grain futures and forward contracts if they think fit ; they might discontinue it if they do not find it paying ; but their business remains exactly what it was, viz., that of traders in rice and other grains. There is authority for this view in the case of Govindram Brothers Limited 1946 14 ITR 764 . For these reasons I hold....... + More
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1949 (11) TMI 15
... ... ... ... ..... profits but I fail to see on what material it can be held that the assessee decided to treat these sums as profits for the previous year. From the way that the Income-tax Officer has acted in deducting ₹ 64,469 from the total amount it is clear that the sum of ₹ 1,56,657 was treated as the income made during the whole of the ten years when the partnership business was being carried on. My answer to the question referred to us is that the sum of ₹ 92,188 cannot be deemed to be the income, profits or gains ....... + More
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1949 (11) TMI 14
... ... ... ... ..... ent, consumed, or expended in the process of the acquisition of the managing directorship or in the earning of the remuneration which has been paid to the managing director. The moneys of the family represented by the shares are still intact as an investment and the shares are giving dividends which go into the coffers of the family. I therefore agree with my learned brother in thinking that the income of Mr. Sankaralinga Ayyar as the managing director of the Indo-Commercial Bank cannot be said to be an asset or income of ....... + More
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1949 (11) TMI 12
... ... ... ... ..... pal amount of the death duty has been held to be an inadmissible deduction in computing the business profit of the assessee in the decision in Ramaswami Iyengar v. Commissioner of Income-tax, Madras 1943 11 I.T.R. 597; I.L.R. 1944 Mad. 635. It has also been held by this Court that costs and expenses incurred by an assessee in resisting the claim of a foreign Government to levy death duty is not an admissible deduction in the computation of his foreign profits, the reason being that the expenditure is not one incurred exclu....... + More
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1949 (11) TMI 11
... ... ... ... ..... f such a joint borrowing by the assessee in the present case cannot be relied on as evidence of any such commercial practice. Neither in its inception nor subsequently when the assessee discharged the entire debt due from himself and Lakshmana Ayyar, could the loss be said to arise out of or in the course of the trade or business of the assessee as bookseller. The assessee was not a financier or banker in whose case alone all borrowing of capital for the business could be considered to form part of the stockin-trade of the....... + More
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1949 (11) TMI 10
... ... ... ... ..... expectations of realisation being disappointed and its being obliged to claim an allowance or deduction for bad debts later on as the debtor in this case is the Government of India. The assessee would normally treat the profits and gains arising from these contracts as realised at Chalakudi as soon as the goods were inspected and approved by the Government and delivery was effected by putting them on rail at Chalakudi or other places in the Cochin State. In these circumstances, the question is, where did the operations tak....... + More
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1949 (10) TMI 9
... ... ... ... ..... on outside Indian States, and it is equally manifest that in ascertaining profits and gains from such business, a consideration of losses incurred in business carried on in an Indian State is absolutely irrelevant. I am, therefore, of the opinion that the loss of ₹ 25,391 in the business carried on in Indian States should be ignored in determining the assessee's income from business in the previous year relevant to the assessment year 1944-45. All that I wish to add to what has been said by my Lord the Chief Just....... + More
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1949 (10) TMI 4
... ... ... ... ..... perfectly clarified by the amount having been fixed under Section 4, sub-section (3), clause (e), of the Muslim Waqfs Act as the pay of the mutawalli. Under that clause the commissioner of Waqfs is required to fix the pay of the mutawalli of each waqf if the waqf is not exempt under Section 2. Section 2 relates to waqfs, which are known as private waqfs. In this case learned counsel for the assessee has given us the fact that the Chief Commissioner of Waqfs has, relying on the old usage, fixed the pay of the mutawalli as 1....... + More
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1949 (10) TMI 3
... ... ... ... ..... portion for which special provision was made in the Excess Profits Tax Act itself. Learned counsel has relied on a decision of their Lordships of the Judicial Committee in Commissioner of Income-tax v. Western India Life Insurance Co., Ltd. 1949 17 ITR 125 , where their Lordships held that the third proviso to sub-section (1) of Section 4 was not applicable to insurance business as the profits had to be ascertained under Rule 2(b) of the Schedule to the Income-tax Act, 1922. That case was, however, decided on the special p....... + More
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1949 (10) TMI 2
... ... ... ... ..... e procedure followed in this country. Without better information on the point it is not possible to say that the same considerations, which applied to Hoystead's case 1926 A.C. 155, apply to decisions in income-tax cases in this country also. Moreover, the precise question, whether the rule of res judicata applies to tax cases also, was not canvassed in Hoystead's case 1926 A.C. 155. It was undisputed that it applied to such cases and the only question canvassed before the House of Lords was whether the requirement....... + More
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1949 (10) TMI 1
... ... ... ... ..... ry object of an immediate return or acquisition of assets which are not of lasting value and are likely to get exhausted or consumed in the process of the return or a very limited number of returns. Coming to the facts of the case before us, the amount of ₹ 5,000 was paid out of the income made in the course of the year. The payment was not made once and for all but had to be made every year. Without incurring this expenditure it was not possible for the company to make the profit which it is intended to be taxed, an....... + More
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1949 (9) TMI 32
... ... ... ... ..... upra) and the payment should be treated as expenditure from revenue and not from capital and is a proper deduction in the computation of profits or gains. The payment here cannot be attributed to capital inasmuch as it was not made with a view to bringing a tangible asset or advantage into existence. It is also to be noted that in order to make it a capital payment the asset or advantage is to be for the enduring benefit of the trade. As Rowlatt, J., said by enduring is meant enduring the way that fixed capital endures. Ro....... + More
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1949 (9) TMI 31
... ... ... ... ..... uestion does not arise and does not call for any answer. There can be no doubt that the application was not in order and was not in accordance with the Rules 2-6B. Learned counsel for the assessee has urged that as the partnership was registered in the previous years and the application for renewal for the year 1941-42 which had been filed on the 30th March, 1943, had not yet been finally disposed of by the Appellate Tribunal, the application dated the 26th July, 1943, was correctly filed as an application, for renewal. On....... + More
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1949 (9) TMI 29
... ... ... ... ..... fore it was open to the assessee to have raised this point at least with regard to the item of ₹ 4,40,878. They did not do so and did not challenge the mode of computation. In our opinion the Tribunal was right in refusing to refer the questions to us. Mr. Kolah contends that the question of law is apparent on the order itself and that it also arises from the facts stated by the Tribunal, but in our opinion there is no suggestion as to this point of law either in the order of the Tribunal or in the statement of the c....... + More
