TMI Blog1937 (8) TMI 12X X X X Extracts X X X X X X X X Extracts X X X X ..... nature within the meaning of Sec. 4(3)(vii) and exempt from assessment . The applicant was employed by Syed Jawad Ali Shah as the manager of the Mian Sahib of Imambara Estate in the Gorakhpur district on a salary of ₹ 400 a month. Syed Jawad Ali Shah established a sugar factory on this estate. He afterwards decided to transfer the factory to a limited company. The Pipraich Sugar Factory Ltd., was established in order to take over the concern. The applicant took a great deal of trouble in disposing of the shares of the company, i.e., in inducing a number of people to invest their capital in the company. After the company had been suc- cessfully floated, the Directors, in recognition of the applicant's services, allotted ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that he would be suitably recompensed for his labours, although as to the actual amount he had to trust to the good sense of the direc- tors. It seems to us that the learned Assistant Commissioner in- tended to find that there was no definite contract which could be enforced and therefore in that sense the payment was a matter of grace on the part of the directors, but that question is of no import- ance because we have to deal with the question of law which has been stated and the Income-tax Commissioner has asked for our opinion upon the assumption that the payment on the part of the directors was voluntary and without any previous agreement or understanding. Learned Counsel for the Income tax Department has also argued that th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... heme of taxation as income, and they think that the clause must be due to the over-anxiety of the draftsman to make this clear beyond possibility of doubt. They cannot construe it as enlarging the word 'income' so as to include receipts of any kind which are not specially exempted . The result is that a receipt may not be income within the proper connotation of that term and yet may come within the exceptions in Sec. 4(3) of the Act. We must decide whether this allotment of shares is income assessable under the Act after considering all the circumstances and applying not only the ordinary meaning of the word 'income' but also the terms of the relevant part of Sec. 4(3) of the Act. Their Lordships in the ca ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... st the company and that any hope that he had was based upon the grace and goodwill of the Directors. It cannot be said that the applicant's object was the production of any definite return. If he hoped for a return that return was certainly not definite in its nature. He may have been actuated by a desire merely to assist his employer in disposing of the Factory hoping thereby to secure his employer's good-will and gratitude. We do not think that the applicant's activities can be described as business which is stated in the Act to include any trade, commerce or manufacture or any adventure or concern in the nature of trade, commerce or manufacture. We think that business must be some activity which has for its object the acquire ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
