1964 (3) TMI 17 - SUPREME COURT

Whether, on the facts and circumstances of the case, the profit computed at ₹ 3,11,646 on the sale of shares in Rohtas Industries Ltd. was in accordance with law ?

Held that:- The cost of 31,909 shares, namely, ₹ 5,83,210 must be spread over those shares and the 31,909 bonus shares taken together. The cost price of the bonus shares therefore was ₹ 2,92,141 because the bonus shares were to rank equal to the original shares. The answer to the question given by the High Court was therefore erroneous and the right answer would be that the profit computed at ₹ 3,11,646 was not in accordance with law. The appeal is therefore allowed