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TMI Blog1960 (2) TMI 79X X X X Extracts X X X X X X X X Extracts X X X X ..... he terms of the first proviso (as inserted by the Finance Act, 1953) to sub-section (1) of section 24 of the Act. The facts are that during the assessment year 1953-54, for the accounting period ending the 23rd of March, 1953, the assessee, Hukam Chand Dalal, carried on two businesses, one as a broker and the other as a jobber or speculator. During the relevant period his brokerage business showed a profit but losses were sustained in the speculative business. Section 6 of the Act sets out the heads under which taxable income can accrue, namely salaries, interest on securities, income from property, profits and gains of business, profession or vocation, income from other sources and capital gains. Section 10 (1) provides that the tax shal ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tion 24 (1) did not in any way control section 10 of the Act. The learned judicial member of the Tribunal cited in this connection a passage from the judgment of the Bombay High Court in Commissioner of Income Tax v. Murlidhar Mathurawalla Mahajan Association to the effect that all businesses wherever carried on constitute one head which falls under section 10 and in order to determine what are the profits and gains of a business under section 10, an assessee is entitled to show all his profits and set off against those profits losses incurred by him in the same head and it is only when he proceeds to set off a loss under business against a profit under some other head that section 24 comes into operation and various considerations will ari ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e has expressed agreement with the general principle that a proviso inserted in a particular section, but at the same time he has held, and in my opinion rightly, that in certain circumstances and particularly in the circumstances in which the proviso appears in the part of the legislature. After pointing out that the matter of computation of taxable income under various heads was dealt with in Chapter III of the Act and that then came Chapter IV which deals with deductions and assessment, he observed : ".... and then we come to section 24 which deals with set-off of loss in computing aggregate income. It is, therefore, clear that the question of set-off only arises after the profits and gains of a business, profession or vocation h ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ure has done. It is clear, therefore, on the language of the proviso itself and on the scheme of the Act, that the Legislature in enacting the so-called proviso was enacting a substantive provision dealing with mode of computing the profits and gains chargeable under the head "profits and gains of business, profession or vocation," and what the Legislature provided was that when you compute these profits and gains, the loss sustained in a speculative transaction must not be taken into account except to the extent of the amount of profits and gains, if any, in any other business consisting of a speculative transaction. It is not as if the proviso has no connection whatever with section 24 (1). In one sense it has, because what is a ..... X X X X Extracts X X X X X X X X Extracts X X X X
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