TMI Blog1986 (2) TMI 51X X X X Extracts X X X X X X X X Extracts X X X X ..... Value of current assets - 9,81,402 Buildings - 6,48,749 Machinery - 6,25,821 ---------- 22,55,972 ---------- Thus, there was an overall surplus of Rs. 10,69,346 received by the assessee. Out of the above said amount, the Income-tax Officer worked out the profit under section 41(2) of the Income-tax Act, 1961, at Rs. 2,01,841. In respect of the balance amount of Rs. 8,67,505, the assessee's case was that this was relatable to the transfer of goodwill and, therefore, not taxable as capital gains in view of the decision of this court in CIT v. Ratnam Nadar [1969] ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... m Nadar [1969] 71 ITR 433, the Tribunal held that the sum was not liable to tax on capital gains. Thus, deducting a sum of Rs. 2,00,000 out of the sum of Rs. 8,67,505 the Tribunal took the view that the balance of Rs. 6,67,505 had to be assessed as capital gains. This amount, according to the Tribunal, did not relate to any immovable property and necessarily it would relate to movable assets and, therefore, the full amount of Rs. 6,67,505 had to be considered for the assessment for the assessment year 1971-72. The Tribunal observed that it would become necessary to apportion this amount between long-term capital gains and short-term capital gains. The Revenue and the assessee were both aggrieved by this view of the Tribunal and two questi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of goodwill. Annexure 'A' to the Appellate Assistant Cornmissioner's order shows that in the accounting period from August 1, 1966, to March 31, 1967, there is a loss of Rs. 1,04,884 and this loss has gone up in the accounting period 1967-68 by Rs. 2,19,350. In the year 1969-70, no depreciation has been claimed, but it appears that if depreciation was claimed, there would also have been a larger loss. In the next two years, there are losses of Rs. 1,06,717 and Rs. 1,23,439. Undoubtedly, all the authorities have proceeded on the footing that there was some goodwill transferred and it appears that the agreement also refers to the transfer of goodwill. The only relevant circumstance for the purpose of ascertaining the value of the goodwill wou ..... X X X X Extracts X X X X X X X X Extracts X X X X
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