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2015 (4) TMI 843 - CALCUTTA HIGH COURT

2015 (4) TMI 843 - CALCUTTA HIGH COURT - TMI - Business of advancing money and cash - capital asset v/s stock-in-trade - Tribunal held that the assesse was not engaged in the business of advancing loans and that money and cash was not its stock-in-trade was perverse and contrary to materials on record and based on irrelevant materials and considerations - Held that:- Copy of the 23rd Annual Report consisting of the statement of accounts of the financial year 1993-1994 from which it appears that .....

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; 52 lakhs were invested in shares and debentures, about ₹ 3.67 crores is invested in inventories consisting of investment in shares and hire purchase transactions; about a sum of ₹ 1.46 crores is receivable on account of lease, hire purchase and others, and a sum of ₹ 5.45 crores were invested in loans and advances both secured and unsecured, part of which has also been lent to the subsidiary referred in the judgment of the learned Tribunal.

From the aforesaid appli .....

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nd order dated 31st January, 2003 passed by the learned Income Tax Appellate Tribunal pertaining to the assessment year 1996-1997. The assessee has come up in appeal. At the time when the appeal was admitted the following questions were formulated. 1) Whether on the facts and circumstances of the case the Tribunal was justified in holding that for the purpose of business of advancing money and cash was capital asset and not stock-intrade of the said business? 2) Whether on the facts and circumst .....

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hare capital was not deductible business and revenue expenditure? 4)If the Question No.2 is answered in the affirmative, but the Question No.3 is answered in the negative, whether on the facts and in the circumstances of the case the finding of the Tribunal that the cash procured by issue of share capital could not be held to be conversion of Capital into stock-in-trade was justified in law and not perverse ? Mr. Murarka, learned advocate, appearing in support of the appeal submitted that the qu .....

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ire, loans and advances. It is further observed from the annual report for the year 1993-94 that the subsidiary company of the assessee, namely, UCL Housing Ltd. had taken necessary action for finalisation of plans of both residential apartments projects, the Queens Park Building for higher income group and the Thakurpukur project at Joka crossing for lower and middle income groups. The report projected confidence that the company would make reasonably good profits in the aforesaid building proj .....

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ty and the assessee can have no connection in law with the subsidiary. He may be right in law in saying that a subsidiary is a separate entity. In deciding the question as regards the nature of business pursued by the assesse the business of a subsidiary of the assessee may not be a relevant consideration. But the learned Tribunal does not appear to suggest that the assessee itself is engaged in the real estate business. The assessee was interested in contending that it is engaged in the busines .....

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