TMI Blog1950 (11) TMI 18X X X X Extracts X X X X X X X X Extracts X X X X ..... Bhawalpur State, under the name and style of Lachhman Das Ganga Sagar. In the Khurja books of the assessee, which were the central set of account and in which income from all sources was incorporated, interest account showed credits of ₹ 17,132 for the assessment year 1943-44 and ₹ 47,029 for the assessment year 1944-45. The assessee was resident and ordinarily resident in British India. The case of the assessee was that the amount of interest mentioned in the books had not been remitted in cash from the Bhawalpur State to British India and the entries were merely book adjustments in the head office books. The Department, however, relied on the fact that the system of accounting followed by the assessee was mercantile sy ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... British India. Reliance is placed by learned counsel for the assessee on a decision of their Lordships of the Judicial Committee in Commissioner of Income- tax, Bombay Presidency and Aden v. Chunilal B. Mehta [1938] 6 I.T.R. 521, where their Lordships held that a person resident in British India carrying on business in British India and controlling transactions abroad is not liable to tax on the profits of such transactions unless such profits can be said to be accruing, arising or received in British India, or deemed to be such. The point for consideration is whether it can be said that the interest was received or deemed to have been received in British India. Reliance is also placed on a decision of the Bombay High Court in Keshav ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ritish India by means of hundis and cheques and a sum of ₹ 29,115 is entered in the books at Aligarh as having been received by means of hundis or realised from the debtors of the Chistian shop. The Income- tax Officer was of the opinion that the amount had actually been remitted. Be that as it may, when it appears from the books of the assessee that there were regular transfer entries made between Chistian and the business centers in British India, of both credit and debit, and it was after adjustment of the account only that the balance was considered to be due and claimable, the amount credited must be deemed to have been received in British India by the assessee. The second question is as follows:- Whether in the circumsta ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n with the business of the company as a trader. In the case before us all that the Tribunal said on the point, which is quoted in the statement of the case, was as follows:- On the facts as found by the Department and which have not been challenged by the assessee's counsel, we hold that the claim has been rightly disallowed as such an expense is not incidental to the business. No further facts have been placed before us, nor do we know what the Department had found, which finding it was said was not challenged by learned counsel for the assessee. In the absence of further information on the point, we have to accept the finding given by the Tribunal that the expense was not incidental to the business. In fact, the assesse ..... X X X X Extracts X X X X X X X X Extracts X X X X
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