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TMI Blog1973 (12) TMI 13X X X X Extracts X X X X X X X X Extracts X X X X ..... r share. On the 30th August, 1961, the contracts were settled by payment of the difference. The ruling price on that day was Rs. 25.50 per share. This resulted in receipt of a sum of Rs. 19,485 by the assessee. The Income-tax Officer treated the aforesaid sum as speculation profit and included it in the assessment of the assessee. The assessee challenged the inclusion of the said amount in appeal before the Appellate Assistant Commissioner on the ground that the said profit was not as a result of an adventure in the nature of trade so as to bring it within the definition of " business " under section 2(13) of the Act and liable to be taxed. The Appellate Assistant Commissioner, however, held that, on the facts and in the circumstances of the case, the amount in question represented speculation profit and rejected the contention of the assessee that the amount should not have been the subject-matter of assessment. He, accordingly, dismissed the appeal on the 5th August, 1965. Against the said order of the Appellate Assistant Commissioner, the assessee filed an application before the Appellate Tribunal. The Tribunal, by its order, dated the 25th July, 1967, held that the amount in qu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Edwards v. Bairstow, came to the conclusion that the question arising in the case is a mixed question of law and fact, and, therefore, open to examination by this court. " The same view was reiterated in the case of Khan Bahadur Ahmed Alladin and Sons and their Lordships observed that the decision of the Appellate Tribunal on this issue was open to challenge. Applying the aforesaid principles, I will now examine as to whether, on the facts and in the circumstances of this case, the inference drawn by the Appellate Tribunal that the transaction was casual in nature is valid and justified. A bare reference to the assessment order will show that the assessee had shown an income of Rs. 925 from house property, Rs. 19,485 the amount in question, as business speculation profit, and Rs. 46,980 as dividend. The Income-tax Officer, in the assessment order, has mentioned that the assessee had shown the amount in question as business speculation profit which had been checked and found to be in order. In appeal before the Appellate Assistant Commissioner, the only challenge was in respect of the aforesaid amount of Rs. 19,485 and exemption was being claimed on the ground that it was an isol ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hat the profit derived from the transaction was an accidental one and not a profit from an adventure in the nature of trade. In most of the decided cases, the initial transaction is one of purchase of properties, shares or other commodities which may prima facie be with the object or intention of investment of money. But, in the instant case, the transactions of forward sales by the assessee, who was a big investor in shares, could not be for the purpose of further investment. Surely, they could be for the purpose of release of a portion of the invested money. Nothing was shown by the assessee in that regard. The transactions of forward sales of shares were not quite foreign to or distinct from the assessee's line of business. On the facts found, therefore, the conclusion was irresistible in law that the assessee entered into an adventure in the nature of trade and gained profit therefrom. Hence, it was rightly included in his income assessable to income-tax by the departmental authorities. In the case of G. Venkataswami Naidu & Co., Gajendragadkar J. (as he then was), observed as follows : ". . . .cases do often arise where the purchaser may be willing and may intend to sell the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of law and fact. In that view of the matter, it is open to this court to arrive at its own conclusion drawn from the facts of the case ; of course, the primary facts need not be questioned before the High Court. Learned counsel has also referred in this connection to the case of Mrs. Sooniram Poddar v. Commissioner of Income-tax, in support of his contention that every speculation is an adventure, but not necessarily an adventure in the nature of trade. This proposition cannot be disputed and every adventure made by an assessee has to be judged on the facts and the circumstances of the particular case for arriving at a finding as to whether it is an adventure in the nature of trade. For the purpose of showing that in the instant case the receipt of the aforesaid amount was not an adventure in the nature of trade, learned counsel referred to the facts of Mothay Gangaraju v. Commissioner of Income-tax and Janab A. Syed Jalal Sahib v. Commissioner of Income-tax. The facts of Mothay Gangaraju were that the assessee was a landowner and a money-lender. At a court auction, he purchased for a sum of Rs. 39,800 the right, title and interest of one Parthasarathi Apparao in certain legacies ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... greement, the assessee received pound 6,000 in cash. The income-tax department claimed from the assessee tax on the aforesaid amount of pound 6,000. A Full Bench of the Rangoon High Court, on a consideration of the facts and the circumstances of that case, held that it was not a profit or gain derived from other sources within the meaning of section 12 of the 1922 Act, and it was a receipt of a casual and non-recurring nature which had been exempted under section 4(3)(vii) of the Act. In my opinion, the facts of that case and the instant case are entirely different. In this connection it will suffice to say that for the purposes of holding as to whether a particular transaction is taxable or not, the facts of other cases, where one or the other view had been taken, are not very relevant, because hardly one comes across cases the facts of which are identical. While dealing with the question as to whether a particular transaction was in the nature of an adventure in trade, B. P. Sinha J. (as he then was), in paragraph 7 of the judgment in the case of Saroj Kumar Mazumdar, observed as follows : " Hence, no decided case can, strictly speaking, be a precedent which could govern the dec ..... X X X X Extracts X X X X X X X X Extracts X X X X
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