9911796707
TMI Blog1969 (10) TMI 17X X X X Extracts X X X X X X X X Extracts X X X X ..... It acquired 10,000 shares of Messrs. Rampur Commercial Corporation Ltd., hereinafter referred to as the " managed-company " in the year 1945, for the value of Rs. 5 each. In the same year the assessee-company acquired the managing agency of the managed-company. On the 20th of January, 1958, the assessee-company applied for transfer of the entire lot of 10,000 shares to Messrs. Oriental Engineering and Commercial Corporation, Calcutta, and eventually transferred the entire lot shares on the 7th March, 1958. The sale was made at the rate of Rs. 4.25 per share to the said Messrs. Oriental Engineering and Commercial Corporation, Calcutta. Shortly after the said transfer on April 18, 1953, the managed-company became amalgamated with the assesse ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... The Appellate Assistant Commissioner, therefore, allowed the sum of Rs. 7,500 as an admissible deduction. Against the order of the Appellate Assistant Commissioner an appeal was preferred by the Income-tax Officer before, the Appellate Tribunal., The Appellate Tribunal found that the crucial question for determination was whether the assessee was a dealer in shares. The Tribunal found that quite a lot of shares were acquired by the assessee during the accounting years from 1945-46 to 1958-59 and it was only in the relevant year of account that the first sale of any shares took place. The Tribunal also noted the fact that simultaneously with the sale of the shares in question the assessee-company acquired the managing agency of the managed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eal. According to the facts found by the Tribunal, therefore, there was no sale of any shares on the 31st of March, 1957, as found by the Appellate Assistant Commissioner. Mr. V. Swarup, appearing for the assessee-applicant, contended that in view of this divergence a supplementary statement might be called for from the Tribunal under section 66(4) of the Act. We do not, however, see that any useful purpose would be served by doing so. In the first place, Mr. Swarup does not dispute the fact that so far as the shares in question are concerned they were acquired in the year 1945, and they were sold for the first time on the 7th of March, 1958. He admits that they had not been sold on the 31st of March, 1957. Even if it is held, as found by t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... managing agency of a sugar mill was in the nature of an investment. In that case also, as in the present case, the memorandum of association of the assessee-company authorised it to deal in shares and other securities. The Supreme Court observed that the circumstance as to whether a transaction is or is not within the company's powers has no bearing on the nature of the transaction or on the question whether the profits arising therefrom are capital acquisition or revenue income. To the same effect is the decision of the Supreme Court in another case, Oriental Investment Co. Ltd. v. Commissioner of Income-tax. In that case it was held that the mere fact that a company has within its object the dealing in investment in shares does not necess ..... X X X X Extracts X X X X X X X X Extracts X X X X
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