TMI Blog2010 (10) TMI 846X X X X Extracts X X X X X X X X Extracts X X X X ..... uld not be the same assessee after merger of two companies as after merger of State Bank of Jaipur with State Bank of Bikaner and with re-christening of the company as State Bank of Bikaner and Jaipur, it cannot be treated to be same "assessee" for income-tax purpose. - D.B. IT Reference No. 45 of 1983 - - - Dated:- 28-10-2010 - Jagdish Bhalla, Mohammad Rafiq, JJ. P.K. Kasliwal for the Appellant Parnitoo Jain for the Respondent JUDGEMENT Mohammad Rafiq, J:- 1. This reference has been received from the Income Tax Appellate Tribunal (hereinafter shall be referred to as 'ITAT') at instance of assessee State Bank of Bikaner and Jaipur. Question that has been referred to this Court for answer under Section 256 (1) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... plication under Section 256(1) of the Act of 1961 before ITAT for referring the above referred to question to this Court. It is in this background that present reference has been received. 3. Shri P.K. Kasliwal, learned counsel for assessee, has argued that present case squarely falls within the scope of Section 78(2) of the Act of 1961 which inter alia provides that even in cases, where a person carrying on any business or profession, has been succeeded in such capacity by another person, otherwise than by inheritance, nothing contained in said Act shall entitle any person other than the person incurring the loss to have it carried forward and set off against his income. Since present one was a case of succession by inheritance, assess ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ould be construed in its natural perspective having regard to compulsion of circumstances. Where it is possible to draw two inferences from facts and where there is no evidence of any dishonest or improper motive on the part of assessee, it would be just and equitable to draw such inference that would lead to equity and justice. It is trite law that where statute confers benefit on assessee; provisions should be so interpreted and words used therein should be assigned such meaning, as would enable the assessee to secure benefit intended to be given by Legislature. Taxing statute has to be interpreted liberally, so as to give effect to object of provision and statute, and advance object of provision and not to frustrate it. Learned counsel, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r can be taken a case of succession by inheritance. Learned counsel, in support of her submissions, relied on judgment of this court in,- 1. Rajasthan Rajya Sahakari Spinning and Ginning Mills Federation Ltd. v. ITAT [2003] 260 ITR 167 (Raj.) and judgments of Supreme Court in, 2. Smt. Saroj Aggarwal v. CIT [1985] 156 ITR 497 (SC), 3. CIT v. Sterling Foods [1999] 237 ITR 579 (SC) and judgment of Karnataka High Court in, 4. Hindustan Aeronautics Ltd. v. CIT [1983] 149 ITR 795 (Kar.). 7. In order to appreciate true content and meaning of word 'inheritance' as used in section 78(2) of the Act of 1961, it would be apposite to reproduce the said provision in extenso for facility of reference, which we do as under:- "Where ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssessee. The assessee set off brought forward losses against its total income under Section 78(2) of the Act of 1961. It was held by this Court that assessee was not entitled to set off the losses carried forward by four cooperative societies against its profits because those cooperative societies had their own entity and were independent. In terms of their profits and losses, they could not be treated as the assessee in the year under consideration. Even after their merger into one society it could not be said that such society had succeeded or such society had received those losses by way of inheritance. 10. In Hindustan Aeronautics Ltd.'s case (supra), the case before the Karnataka High Court was one of the amalgamation of the compan ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nd minor children, wife entered into partnership with third person and minor children were admitted to benefits of partnership. Premises and remaining machinery were leased to said firm. Share of profits of wife and minor children were included in total income of assessee and losses incurred by assessee in his business in earlier years were brought forward. In those facts, it was held by the Supreme Court that income includes losses and that the assessee was entitled under Section 24(2) of the Indian Income Tax Act of 1922 to set off the losses in his individual business. The share income of the wife and minor children in the firm was included in the total income of the assessee under Section 16(3) of the Act of 1922, which provision provid ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
