TMI Blog1955 (1) TMI 46X X X X Extracts X X X X X X X X Extracts X X X X ..... material facts which have a bearing on the character of the transaction leading to the receipt by the assessee of the sum in question. The assessee is a trader interested in several lines of business. He does business in timber, tiles, furniture, ironware and hardware, some in partnership with others and some entirely on his own. He also owns seagoing schooners and other boats jointly with others which are plied for transport of cargo as well as passengers. He belongs to a family of bankers and traders, he and his brothers having been described by the Appellate Assistant Commissioner of Income Tax as being the foremost business man of Masulipatam. On 29.8.1941, by a registered deed of transfer, he purchased for a sum of ₹ 62,500/- ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 1,540/- for his share of the decree. The amount, so realised exceeded the price paid by him for the purchase of the decree by a sum of ₹ 89,040/-. Deducting the sum of ₹ 10,000/- for the expenses of realisation and another sum of ₹ 4,000/- which the assessee had to pay his assignors by way of interest from the above sum, the Income Tax Officer treated the balance of ₹ 75,040/- as gains or profits of an adventure or concern in the nature of trade and computed it in the assessment year 1945-46 as part of the income of the assessee in the previous year ending with 31.12.1944. Before the Income Tax Authorities and the Appellate Tribunal, the assessee contended unsuccessfully that this sum is not a receipt arising from ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he counsel for the assessee in -- 'Mrs. D. M. Alexander v. The Commissioner of Income Tax, Madras', [1952]22ITR379(Mad) (A), where their Lordships of the Madras High Court state : Even a single venture may amount to business and the profits of such a single venture may be taxable as income arising from business. A Full Bench of the Lahore High Court expressed the same view in -- 'Behari Lal Jhandumal', In re : AIR 1944 Lah 287 (B), and Muhammad Munir J., observed at page 291 of the report as follows : If Mr. Kirpa Ram Bajaj's argument is that an isolated venture cannot be a venture in the nature of trade, the position is untenable because in the present state of authorities the proposition that an isolated ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... se. We may now state what, in our opinion constitute relevant factors in arriving at a conclusion of fact on the question as to whether a particular transaction is or is not an adventure in the nature of trade or commerce and what is the nature of the thing to which the transaction relates. Could its acquisition have been for use or enjoyment in the ordinary way ? A man may buy a horse, a book or a piece of land. They may be for use or enjoyment by himself. If a man buys a decree for instance, as in this case, it is impossible to say that the subject matter of purchase is for use and enjoyment. The scale of the transaction is also a material factor. If a man goes into the market and buys an immense quantity of a metal or cotton or toilet ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... investment i.e., is the money laid out in buying a thing expected to fetch a regular periodical return ? A lawyer may buy a share certificate or a debenture in a company. There would be no presumption in such a case that the share or debenture was purchased with the sole object of re-selling at a profit. On the other hand, if a person regularly dealing in shares does so, surely it would be a piece of business. The nature of the operations involved in acquiring and disposing of a thing may also be relevant. It is true that a consideration of all these questions may not be necessary in deciding a particular case. A clear answer to one or other of the questions thus raised may be decisive other of the questions thus raised may be decisive in s ..... X X X X Extracts X X X X X X X X Extracts X X X X
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