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Showing 61 to 80 of 81 Records
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1960 (11) TMI 21
Whether as between the appellant company and the respondent the amount decreed is due as salary payment which attracts the statutory liability imposed by section ?
Held that:- In the present case there is a decree passed in favour of the respondent ; under the scheme of the Civil Procedure Code, that decree has to be executed as it stands, subject to such deductions or adjustments as are permissible under the Code. There was no tax liability which the respondent was assessed to pay in respect of this amount till the date on which the appellant company sought to satisfy the alleged tax liability of the respondent. As between the appellant company and the respondent, the amount did not represent salary ; it represented a judgment debt and for payment of income-tax thereon, no provision was made in the decree. The Civil Procedure Code bars an action of the nature which was filed in Westminster Bank's case. The defence to the execution, if any, must be raised in the execution proceeding and not by a separate action. The amount payable by the appellant company to the respondent was not salary but a judgment debt, and before paying that debt the appellant company could not claim to deduct at source tax payable by the respondent. Nor could the appellant company seek to justify its plea on the ground that the judgment creditor was indebted to a third person. Appeal dismissed.
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1960 (11) TMI 20
Whether after the dissolution of the firm by the death of M. P. Thomas in October, 1949, no order imposing a penalty could be passed against the firm?
Held that:- the petition filed by the appellant should not have been entertained. The Income-tax Act provides a complete machinery for assessment of tax and imposition of penalty and for obtaining relief in respect of any improper orders passed by the income-tax authorities, and the appellant could not be permitted to abandon resort to that machinery and to invoke the jurisdiction of the High Court under article 226 of the Constitution when he had adequate remedy open to him by an appeal to the Tribunal.
On the merits, the appellant is not entitled to relief. The Income-tax Officer found that the appellant had with a view to evade payment of tax, deliberately concealed material particulars of his income. Even though the firm was carrying on transactions in food grains in diverse names, no entries, in respect of those transactions in the books of account were posted and false credit entries of loans alleged to have been borrowed from several persons were made. The conditions prescribed by section 28(1)(c) for imposing penalty were, therefore, fulfilled. Appeal dismissed.
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1960 (11) TMI 19
Whether in the circumstances of the case assessment proceedings were validly initiated under section 34 of the Indian Income-tax Act ?
Whether in the circumstances of the case the amount received from interest on arrears of agricultural rent was rightly included in the income of the assessee ?
Held that:- No question of law was raised before us, as it could not be in view of the decision of this court in Narayana Chetty v. Income-tax Officer [1958 (10) TMI 10 - SUPREME Court] that the proviso was not mandatory in character. Indeed, there was time enough for fresh notices to have been issued, and we fail to see why the old notices were not recalled and fresh ones issued. Appeal dismissed.
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1960 (11) TMI 18
Whether, in the facts and circumstances of this case, the Appellate Tribunal was right in holding that ₹ 61,818, spent by the assessee to train Indian boys as jockeys, did not constitute expenses of the business of the assessee allowable under section 10(2)(xv) ?
Held that:- High Court has rightly held that the expenditure claimed was one which was wholly and exclusively laid out for the purpose of the respondent's business. It was to prevent the threatened extinction of the business of the respondent. In the result this appeal is dismissed
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1960 (11) TMI 17
Whether the assessee is entitled to a deduction of ₹ 1,350 and ₹ 18,000 from his total income of the previous year relevant to the assessment year 1953-54/1954-55 ?
Held that:- The question referred to the High Court ought to have been answered in the negative. We, accordirgly, discharge the answer given by the High Court, and the question will be answered in the negative. The appeal is thus allowed
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1960 (11) TMI 16
Whether the assessee's claim is sustainable under section 10(2)(xv) of the Act?
Whether the assesse's claim that the loss was a business loss and, therefore, allowable as a deduction in computing the profits of the assessee's business is sustainable under law ?
Held that:- Considering the finding that there is mutuality and custom of borrowing money on joint pronotes for the carrying on of business. In our opinion, in the circumstances proved in the present case, and on the facts established and on the findings given, the respondent was rightly held to be entitled to deduct the loss which was suffered by him in the transaction in dispute. Appeal dismissed.
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1960 (11) TMI 15
Whether on the facts and in the circumstances of the case, the payment of ₹ 82,250 is an allowable expenditure under section 10(2)(xv) of the Indian Income-tax Act ?
Held that:- High Court rightly held that the amount claimed was not deductible and we, therefore, dismiss this appeal.
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1960 (11) TMI 14
Whether on the facts and in the circumstances of this case the Tribunal's conclusion that the land was not assessed to land revenue within the meaning of section 2(1)(a) of the Indian Income-tax Act is justified ?
Held that:- The history of redemption is a matter of record, and it is plain that Government was accepting a down payment and freeing land from land revenue. This is precisely what was done, and the result of the down payment is set out with great clarity in the deed itself, and it is that there was no land revenue assessed on or demandable from that land. In fact, no demand or payment or charge in the nature of land revenue could ever be made on it. In view of this, it is, in our judgment, quite satisfactorily established that this land was not assessed to land revenue and the income from it did not fall within section 2(1)(a) of the Income-tax Act. The answer given by the High Court was thus correct. Appeal dismissed.
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1960 (11) TMI 13
Whether the sum of ₹ 15,608 should have been included in the assessee company's 'profit' for the purpose of determining whether the payment of a larger dividend than that declared by it would be unreasonable ?
Held that:- By the fiction in section 10(2)(vii), second proviso, read with section 2(6C), what is really not income is, for the purpose of computation of assessable income, made taxable income; but on that account, it does not become commercial profit, and if it is not commercial profit, it is not liable to be taken into account in assessing whether in view of the smallness of profits a larger dividend would be unreasonable.
The High Court was right in holding that the amount of ₹ 15,608 was not liable to be taken into account in considering whether having regard to the smallness of the profit made by the company, it would be unreasonable to declare a larger dividend.Appeal dismissed.
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1960 (11) TMI 12
Whether the notification is validly made under section 12 or is it ultra vires the powers conferred on the Central Government by that section?
Does the notification apply to the assessment in the present case, which is an assessment for the year 1951-52 ?
Held that:- The notification of 1956, was validly made under section 12 and is not ultra vires the powers conferred on the Central Government by that section.
The Central Government has, therefore, the power to make an order or give a direction so as to remove the difficulty from the very beginning, and that is what the notification of 1956 does. It applies to the assessment of 1951-52; indeed, it applies to all assessments made under the Indian Income-tax Act in which paragraph 2 of the Removal of Difficulties Order, 1950, operates.
The notification of 1956 creates no unequal treatment of persons in a like situation; it applies to all who are in a like situation, namely, all those to whom paragraph 2 of the Removal of Difficulties Order, 1950, applies. We consider that the challenge to the notification based on article 14 is wholly unsubstantial. Appeal allowed.
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1960 (11) TMI 11
Whether on the facts and circumstances of the case, the distribution of the right to apply for the shares of the Bank of India by Navjivan Mills Ltd., in favour of the assessees amounted to a distribution of 'dividend' ?
Held that:- Dividend need not be distributed in money; it may be distributed by delivery of property or right having monetary value. The resolution, it is true, did not purport to distribute the right amongst the shareholders as dividend. It did not also take the form of a resolution for distribution of dividend; it took the form of distribution of a right which had a monetary value. But by the form of the resolution sanctioning the distribution, the true character of the resolution could not be altered. We are, therefore, of the view that the High Court was right in holding that the distribution of the right to apply for and obtain two shares of the Bank of India (at half their market value) for each share held by the shareholders of the mills amounted to distribution of dividend. Appeal dismissed.
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1960 (11) TMI 10
Whether on the facts and circumstances of the case, the business activities of the company to wit, manufacture and sale of sugar and sale and purchase of gunnies, jute, mustard seeds constituted the same business within the meaning of section 24(2) of the Indian Income-tax Act, 1922 ?
Held that:- A question of law did arise in the case, on which the High Court should have asked for a statement of the case. Appeal allowed and direct the High Court to call for a statement of the case from the Tribunal on this question, and dispose of it, according to law.
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1960 (11) TMI 9
Whether the Tribunal was justified in law in holding that the petitioner had carried on its business only till the twenty-eighth day of August, one thousand nine hundred and forty-five ?
Whether on the facts and circumstances of the case, the Income-tax Appellate Tribunal was justified in law in not allowing the sum of ₹ 41,998 (Rupees forty-one thousand nine hundred and ninety-eight) on sale of machines and ₹ 3,700 (Rupees three thousand and seven hundred) on the sale of lorry as a deduction from the total income of the applicant ?
Held that:- Appeal dismissed. The High Court correctly answered the first question in the affirmative, holding that there was evidence on which the Tribunal could reach the conclusion that the business had, in fact, been continued only till August 28, 1945.
On the second question, the High Court was of correct opinion that the business having been carried on for at least a part of the account year, section 10(2)(vii) was applicable, and that, therefore, this allowance had to be made under that clause. The High Court, therefore, answered the question in the negative. The High Court refused to grant a certificate to appeal to this court, but the Commissioner of Income-tax applied for and obtained special leave, and this appeal has been filed.
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1960 (11) TMI 8
Whether the conditions precedent for the assumption of jurisdiction under section 34 were not satisfied?
Held that:- The conditions precedent to the exercise of jurisdiction under section 34 of the Income-tax Act did not exist and the Income-tax Officer had therefore no jurisdiction to issue the impugned notices under section 34 in respect of the years 1942-43, 1943-44 and 1944-45 after the expiry of four years.
We have therefore come to the conclusion that the company was entitled to an order directing the Income-tax Officer not to take any action on the basis of the three impugned notices. In view, however, of the fact that the assessment orders have already been made we think it proper that in addition to an order directing the Income-tax Officer not to take any action on the basis of the impugned notices a further order quashing the assessment made be also issued. Appeal allowed.
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1960 (11) TMI 7
Whether the income derived by the company from shops and stalls is income received from property and falls under the specific head described in section 9?
Held that:- The income received by the appellant from shops is indisputably income from property; so is the income from stalls from occupants. The character of the income is not altered merely because some stalls remain occupied by the same occupants and the remaining stalls are occupied by a shifting class of occupants. The primary source of income from the stalls is occupation of the stalls, and it is a matter of little moment that the occupation which is the source of the income is temporary. The income-tax authorities were, in our judgment, right in holding that the income received by the appellant was assessable under section 9 of the Income-tax Act. Appeal dismissed.
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1960 (11) TMI 6
Whether there is in this case any legal evidence to support the inference of the Tribunal that the partition in question was not genuine and meant to be acted upon?
Held that:- As the partition set up in this case was of December 30, 1944, whereas the partition set up in the earlier case was of October 16, 1944. As the High Court has pointed out on the additional facts which were proved before the Tribunal including the statements on oath of the sons of the respondent and the other relevant material it cannot be said that there were no materials before the Appellate Tribunal for finding in favour of the respondent and in favour of the partition being genuine. The decision of the High Court was right and this appeal must also fail and is dismissed with costs.
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1960 (11) TMI 5
Whether the order of the Income-tax Officer could be restored in toto in view of this finding, because the Income-tax Officer had taken the whole of the income of the firm into Chhotalal's individual assessment?
Held that:- The Tribunal was trying to unravel the motive for the formation of the new firm with an old lady and two minor sons in place of Chhotalal, and what was observed by the Tribunal was in connection with the motive which suggested itself to it, and was not based on any material. Even if the Tribunal mentioned those suspicions, we do not think that they entered into the solution of the problem before it. Suspicions and surmises are best avoided ; but in the present case, the order of the Tribunal proceeded on such solid facts that the speculation about the motive of Chhotalal did not make any material difference to the finding reached, though we cannot help saying that the Tribunal would have been well-advised to leave speculation out altogether.Appeal dismissed.
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1960 (11) TMI 4
Whether there was any material to hold that the Bombay branch of your petitioner sold 1,66,188 pieces of sovereign to the Karachi branch at market rates?
Held that:- The order passed by the Income-tax Officer does not refer to any evidence in support of the assertion made by him that the Bombay branch of the appellant sold sovereigns to the Karachi branch.The criticism of the Appellate Assistant Commissioner about the unsatisfactory character of the evidence has a bearing on the local sales and not on the despatches to Karachi. The Tribunal merely accepted the conclusion of the Appellate Assistant Commissioner ; it gave no independent reasons in support of its order. The income-tax authorities did not find that on a comparison of the rates at which the sovereigns are debited in the Bombay branch and the rates at which they were credited in the Karachi branch, any profit was earned by the Bombay branch.
In our view, a question of law arises from the judgment of the Tribunal which confirmed the order of the Appellate Assistant Commissioner. We accordingly direct that the Tribunal do draw up and submit a statement of the case on the following question which arises from the order of the Tribunal \
" Whether there was any material to hold that the Bombay branch of the assessee sold 1,66,188 pieces of sovereigns to the Karachi branch ?
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1960 (11) TMI 3
Whether on the facts and in the circumstances of the case the decision of the Tribunal that the firm is not genuine and not registerable under section 26A of the Indian Income-tax Act is right in law ?
Held that:- A question of law arises out of the order of the Tribunal, namely, " whether in the facts and circumstances found by the Tribunal, there was material to come to the conclusion that the partnership firm constituted by the deed of partnership dated November 16, 1949, was not genuine? " We would accordingly allow these appeals, set aside the order of the High Court of Mysore dated October 8, 1958, and direct that the Tribunal be required to state a case on the question indicated above and refer it to the said High Court. Appeal allowed.
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1960 (11) TMI 2
Evidence - Proof ... ... ... ... ..... there is no other clinching circumstance to connect the petitioner with the posting or with the writing on the envelopes which contained the notes, it cannot be said that the guilt has been established beyond all reasonable doubt. 6. The conviction and sentence of the petitioner are, therefore, set aside and he is acquitted. The revision petition is allowed. The fine amount, if paid, will be refunded. 7. Since the revision petition is allowed, the appeal by the State against the acquittal of the respondent in the appeal has to fail, since it is on the same facts that the State seeks to set aside the acquittal of the respondent accused of an offence under Section 167(81). If the offence under Section 23(1) of the Foreign Exchange Regulation Act is not made out, the offence under S. 167(81) of the Sea Customs Act also is not made out. The appeal against the acquittal by the State is dismissed. Exs. D. 2 and D. 3, the passports belonging to the accused will be returned to him.
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