TMI Blog1980 (1) TMI 6X X X X Extracts X X X X X X X X Extracts X X X X ..... amount was to be advanced in monthly instalments spread over between April, 1954, to October, 1954. The expectation of the parties was that the producers would be in a position to deliver the prints of the picture and the publicity material on or before October 15, 1954. In consideration of the advances thus made by the assessee, the producers agreed to give to the assessee the rights of exploitation, distribution and exhibition of the picture in what may be briefly described as the northern circuit. After the picture was released, the assessee was to be entitled to a commission of 20% of the collections. The balance of 80% was to belong to the producers but the assessee would be entitled to recoup therefrom the advances of Rs. 1,00,001 ma ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ty only) in our account, besides the interest, for the financial help rendered by you in consideration thereof, we hereby irrevocably undertake to sell to you permanently on outright basis, the distribution, exhibition and exploitation rights of the aforesaid picture for the territory of Delhi U.P. for a total Sum of Rs. 1,73,000 (Rupees one lakh and seventy-three thousand only) including the payment of Rs. 1,40,000 (Rupees one lakh and forty thousand only) (Rupees one lakh twenty thousand only already, received and Rs. 20,000 payable by you against the delivery of the prints). We irrevocably authorise you not to submit any business statement in respect of this picture and also to retain the entire collections with you. It is also underst ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... our months from March 7, 1958, to June 30, 1958. During the period the collections made by the assessee from the picture amounted to Rs. 79,681. We are concerned in this reference with the assessment of the assessee for the assessment year 1959-60 for which the accounting year ended on June 30, 1958. Though the assessee had received collections from the picture amounting to Rs. 79,681, it did not take into account this collection while filing its return for the purposes of its assessment. The original assessment was also completed without including any income from this picture. However, subsequently, the assessment was reopened under s. 147(a) of the I.T. Act, 1961. The ITO completed the reassessment by including therein the collections ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ether, on the facts and in the circumstances of the case, sale of picture 'Baghi Sipahi' for the purposes of its amortisation was to be taken as from March 7, 1958, or June 30, 1958 ? " As pointed out by Shri P.N. Monga, counsel for the assessee, the question does not correctly bring out the controversy between the parties. The reference to amortisation in the question appears to be irrelevant. The controversy between the parties was " whether the assessee became the owner of the picture only on June 30, 1958, or even earlier and whether, on the facts and the circumstances of the case, the sum of Rs. 43,881 was assess able in its hands". We reframe the question in the above terms. We have heard Shri P.N. Monga, counsel for the assesse ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... arch 7, 1958. In our opinion, therefore, the sale of the picture became complete, at the latest by March 7, 1958, in terms of the letter dated June 3, 1956. The language of the letter also leaves no doubt about this and makes it clear that the assessee could enjoy all the benefits of the picture as if it was the owner thereof. There is, therefore, no error in the conclusion of the Tribunal that the assessee became the owner of the picture by March 7, 1958, at the latest. Shri P.N. Monga contended that since the letter dated June 3, 1956, contemplated regular sale documents being executed by the producers in due course, the sale cannot be held to be complete till those documents were executed and, according to him, the sale document is th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... completed for a consideration of only a sum of Rs. 1,00,000 as against the sale consideration of Rs. 1,73,000 agreed upon in June, 1956. He says that the film had proved a failure and, therefore, the producers were ultimately willing to sell the picture for a smaller sum than had been agreed upon originally. In this connection, learned counsel invited our attention to an order of the AAC for the assessment year 1960-61 and also to a statement of account of the producers in the books of the assessee. In our opinion, this is a totally new case attempted to be put up by the counsel. We do not find in the printed papers before us any suggestion or contention that on June 30, 1958, a totally new contract had been entered into between the parties ..... X X X X Extracts X X X X X X X X Extracts X X X X
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