K.L. Roy, J.
1. The petitioner is a sterling company with its head office in London carrying on business in tea in the United Kingdom. It also holds shares in different tea companies in other parts of the world. It has dividend income in India from its shares in M/s. Brooke Bond (India) Ltd, which is its 100 per cent. subsidiary company. The petitioner claims that it also carries on the business of investing monies in shares of tea companies and its income from dividend is income from its business. It is to be noted that the petitioner's status for any particular assessment year depends on whether its income in India exceeds or is less than its income outside India. For the assessment year 1956-57, the First Additional Income-tax Officer, Companies District I, Calcutta, on the 28th March, 1957, completed the assessment of the petitioner in the status of a non-resident in respect of its dividend income in India only and determined the total income at Rs. 53,11,958. The assessment for the immediate preceding year 1955-56 was made by the said Income-tax Officer, on the 16th July, 1957, and for this year, as the income in India exceeded the income outside India, the petitioner's status was taken as resident and ordinarily resident and after deducting the net loss computed from the petitioner's business in the United Kingdom at Rs. 65,61,147 from its Indian dividend income of Rs. 34,27,500, the net lo^ for this year was determined at Rs. 31,33,647. The assessment for the subsequent year 1957-58 was again made in the status of a nonresident some time in November, 1957, only on the total dividend income in India of Rs. 51,85,837. As the assessment for 1956-57 was made before the assessment for 1955-56, the petitioner claimed to set off its loss carried forward from the year 1955-56 against its assessed income for 1957-58 and appealed against the order of assessment for the later year to the Appellate Assistant Commissioner. By his order dated the 14th August, 1958, the Appellate Assistant Commissioner dismissed the petitioner's appeal, inter alia, on the ground that under Section 24(2) of the Indian Income-tax Act, 1922 (hereinafter referred to as 'the Act'), the loss sustained in any yearcould be carried forward and set off against the profits, if any, of the following year and the loss of 1955-56 could not be set off against the income for 1957-58 without first being set off against its income for 1956-57. The petitioner had, in the meantime, on the . 12th February, 1958, made two applications to the respondent, Commissioner, under Section 33A(2) of the Act for, (1) the determination of the loss to be carried forward in the assessment for the year 1955-56 which had been omitted by the Income-tax Officer, and (2) for the set off of the loss carried forward from the year 1955-56 against the dividend income of the subsequent year as such dividend income formed part of the petitioner's business income or in the alternative for set off of the unabsorbed depreciation carried forward from the year 1955-56. The petitioner also filed an appeal against the aforesaid order of the Appellate Assistant Commissioner to the Income-tax Appellate Tribunal and by its order dated the 1st July, 1966, the Tribunal allowed the appeal holding that the Appellate Assistant Commissioner was not justified in refusing to set off any loss carried forward from 1955-56 against the income for the year 1957-58 as such loss was entitled to be set off against the income of any subsequent year. The Tribunal recorded the petitioner's claim that in investing monies in shares in foreign tea companies it was carrying on a business and the income from dividend from such shares was its business income but left open the question whether the loss from business carried forward from 1955-56 could be set off against the said dividend income in the subsequent years. An application under Section 66(1) of the Act to the Tribunal for reference of a certain question of law to the High Court was made by the respondent, Commissioner, and the annexure to that application being statement of the facts which were admitted and/or found by the Tribunal and which were necessary for drawing up a statement of the case contained the following words, viz.:
'The assessee is a sterling company with its head office in London carrying on business in tea in the United Kingdom. It also carries on the business of investing moneys in shares of companies in other parts of the world which carry on the business of growing, manufacturing and selling tea exclusively. The assessee's income from dividend, though treated by the assessee as income from business, is taken for the assessee's assessment under the Indian Income-tax Act as income from other sources.'
2. It would be seen that this is a repetition of the recital contained at the beginning of the Tribunal's aforesaid order and this fact would be material as much was sought to be made out of this statement by Mr. Ray. The aforesaid application was dismissed by the Tribunal on the 1st December, 1966. On the 5th December, 1966, the respondent. Commissioner, passed a consolidated order on the said two applications under Section 33A(2) made on the 12th February, 1958. He allowed the first application and directed the Income-tax Officer to determine the loss to be carried forward in the assessment for 1955-56. But he dismissed the petitioner's claim for set off against the dividend income for 1956-57, inter alia, on the following grounds, (1) that the dividend earned by the petitioner-company from investments in shares of companies carrying on tea business could never be said to be a part of its business income because investments in shares were hot incidental to the petitioner's business activities and as they were not incidental to the petitioner's business activities they were not held as trading assets ; (2) that the companies from which the dividend income was earned were not companies of which the petitioner-company was the managing agents so as to require making of such investments for the purpose of the business of such managing agents. Accordingly, the Commissioner held that such dividend income could not be considered to be the petitioner's business income and the loss carried forward from the petitioner's business in the United Kingdom could not be set off against such dividend income under Section 24(2) of the Act. In coming to this conclusion the respondent. Commissioner, considered and discussed the three decisions of the Supreme Court relied on by the petitioner's advocate before him and also cited in the written arguments submitted by him, namely United Commercial Bank Ltd. v. Commissioner of Income-tax, : 32ITR688(SC) , Commissioner of Income-tax v. Chugandas & Co., : 55ITR17(SC) , Commissioner of Income-tax v. Cocanada Radhaswami Bank Ltd., : 57ITR306(SC) , and distinguished them on the facts from the case before him. The Commissioner also rejected the petitioner's alternative claim for set off of the unabsorbed depreciation brought forward from 1955-56 and be distinguished the Supreme Court's decision in Jaipuria China Clay Mines (P.) Ltd. v. Commissioner of Income-tax, : 59ITR555(SC) , relied on by the petitioner on the ground that the unabsorbed depreciation of the earlier year could be set off against the income under the other heads only when there was business income in the current year and the unabsorbed depreciation brought forward from the earlier year formed a part or whole of the depreciation allowance claimed to be set off against the income from that business.
3. The application for a rule was made to this court on the 11th May, 1967, and was dismissed by B. C. Mitra J. An appeal from the order of dismissal was taken and by its order dated the 21st December, 1967, the appellate court allowed the appeal, set aside the order refusing the rule and directed the issue of a rule nisi as prayed for ; the cost of the appeal was to abide by the result of the rule nisi.
4. The rule has come up for hearing before this court. In the affidavit-in opposition by Sudhir Ranjan Ray, the Income-tax Officer, B-Ward, Companies District II, Calcutta, it is stated that the dividend from the Indian company has never been treated by the petitioner as its income from business and in the returns filed for all the relevant years the said dividend income has been shown under 'other sources' and has been assessed as such.
5. Before I deal with the arguments of the learned counsel, it would be convenient to set out the relevant provisions of the Indian Income-tax Act, 1922, which was the Act applicable to the assessment years covered by the impugned order of the Commissioner.
6. Section 6 :
'Heads of income chargeable to income-tax.--Save as otherwise provided by this Act, the following heads of income, profits and gains, shall be chargeable to income-tax in the manner hereinafter appearing, namely:--(i) Salaries, (ii) Interest on securities, (iii) Income from property, (iv) Profits and gains of business, profession or vocation, (v) Income from other sources, (vi) Capital gains.'
7. Section 10(2) (vi), proviso (b) :
'Where in the assessment of the assessee.........full effect cannot begiven to any such allowance.........owing to there being no profits or gainschargeable for that year, or owing to the profits or gains chargeable being less than the allowance, then, subject to provisions of Clause (b) of the proviso to Sub-section (2) of Section 24, the allowance or part of the allowance to which effect has not been given......shall be added to the amount ofthe allowance for depreciation for the following year and deemed to be part of that allowance, or if there is no such allowance for that year, be deemed to be the allowance for that year, and so on for succeeding years.'
8. Section 12(1A):
'Income from other sources shall include dividends.'
9. Section 24(2):
'Where any assessee sustains a loss of profits or gains in any year, being a previous year not earlier than the previous year for the assessment for the year ending on the 31st day of March, 1940, in any business, profession or vocation, and the loss cannot be wholly set off under Sub-section (1),so much of the loss as is not so set off or the whole loss where the assessee had no other head of income shall be carried forward to the following year, and......
(ii) where the loss was sustained by him in any other business, profession or vocation, it shall be set off against the profits and gains, if any, of any business, profession or vocation carried on by him in that year: provided that the business, profession or vocation in which the loss was originally sustained continued to be carried on by him in that year; and
(iii) if the loss in either case cannot be wholly so set off, the amount of loss not so set off shall be carried forward to the following year and so on, but no loss shall be so carried forward for more than eight years'.
10. Section 33A:
'(2) The Commissioner may, on application by an assessee for revision of an order under this Act passed by any authority subordinate to the Commissioner, made within one year from the date of the order (or within such further period as the Commissioner may think fit to allow on being satisfied that the assessee was prevented by sufficient cause from making the application within that period), call for the record of the proceeding in which such order was passed, and on receipt of the record may make such inquiry or cause such inquiry to be made, and, subject to the provisions of this Act, may pass such order thereon, not being an order prejudicial to the assessee, as he thinks fit:
Provided that the Commissioner shall not revise any order under this sub-section if-
(a) where an appeal against the order lies to the Appellate Assistant Commissioner or to the Appellate Tribunal but has not been made, the time within which such appeal may be made has not expired, or, in the case of an appeal to the Appellate Tribunal, the assessee has not waived his right of appeal, or
(b) where an appeal against the order has been made to the Appellate Assistant Commissioner, the appeal is pending before the Appellate Assistant Commissioner, or
(c) the order has been made the subject of an appeal to the Appellate Tribunal:
Provided further that an order by the Commissioner declining to interfere shall be deemed riot to be an order prejudicial to the assessee.'
11. Mr. Ray, the learned counsel for the petitioner, argued his case as if it was an appeal from the order of Commissioner tinder Section 33A(2) and not an application for high prerogative writs. Sometimes it has been rather difficult to follow his line of thought as he seemed to think that certain claims made by the petitioner, if not specifically controverted by the department, must be held to be conclusive in deciding the issue. It is well to remember that this is mainly an application for the issue of a writ of certiorari for quashing the order of the Commissioner under Section 33A and proceedings in connection therewith and also for a writ of prohibition restraining the respondent, from giving any effect to the aforesaid order. The circumstances in which this court would exercise its jurisdiction under Article 226 and issue a writ in the nature of certiorari or prohibition have been laid down in several decisions of the Supreme Court and on a review of these decisions S. P. Mitra J., sitting with S, C. Ghosh J., in Sovachand Mulchand v. Collector of Central Excise, : AIR1968Cal174 , has observed, inter alia, that:
'(1) Certiorari can be issued for correcting an error of jurisdiction, as for example where inferior courts or tribunals have, (i) acted without jurisdiction, or (ii) in excess of jurisdiction, or (iii) failed to exercise the jurisdiction vested in them.. ..
(3) Certiorari can also be issued where there is an error of law (but not an error of fact) apparent on the face of record, as for example it is manifest that the conclusion of law made by the inferior court or tribunal is based on an obvious misinterpretation of a statutory provision or ignorance of it, or in disregard of it, or for reasons erroneous in law,'
12. It was further observed that every case must depend on its own facts and it is inexpedient to lay down any general test to determine what are errors of law apparent on the record.
13. Mr. Ray submitted that the Commissioner's finding in paragraph 10 of the impugned order that the shares in the tea companies were not part of the business assets of the petitioner was not based on any material and was not justified. Under Section 33A(2) the Commissioner could pass an order after perusal of the records and/or after making such enquiries as he might think necessary. In this case no enquiry was made. The Commissioner said that the shares were not held as business assets merely as his ipsi dixit. The only record considered by the Commissioner was the petitioner's application under Section 33A(2). The learned counsel contended that the finding of the Tribunal in its appellate order and the statement made by the Commissioner in its application under Section 66(1) conclude the case against the department as it is admitted in the said application that the assessee not only carried on the business of growing, manufacturing and selling tea exclusively but also that of investment in shares of tea companies. Mr. Ray further submitted that the averments made in the application under Section 33A(2) are also uncontroverted. These were parts of the record before the Commissioner on which the Commissioner had to pass his order and if he had any doubts he could call for fresh evidence or make such other enquiries as he thought necessary. If it is conceded that the assessee treats the dividend from the shares in the tea companies as part of its business income nothing else remains and the petitioner is entitled to the relief claimed in the application under Section 33A. Undoubtedly, the petitioner showed the income from the dividend as income under Section 12 as it was bound to do but that does not affect its right to claim a set off of business loss from such income if the shares are held as trading assets.
14. Mr. Ray submitted further that the three decisions of the Supreme Court cited before the Commissioner, namely, United Commercial Bank's case, Chugandas & Co.'s case and Cocanada Radhaswami Bank's case, establish the proposition contended for by the petitioner, namely, that though the income derived from the heads mentioned in Section 6 are assessable under the particular provisions of the Act governing such heads, business loss carried forward from earlier years could be set off against the assessee's income of the current year from any source which constitute the assessee's business assets. The Commissioner was not justified in distinguishing the aforesaid decisions of the Supreme Court on the ground that the dividend income from the tea companies in the petitioner's case was not income from its trading activities because, (i) investment in shares was not incidental to its business, and (ii) because the companies from which dividend income was earned were not companies of which the petitioner-company was the managing agents so as to require making of such investments for the purpose of the managing agency.
15. Mr. Ray analysed the three decisions of the Supreme Court mentioned above as follows: In the United Commercial Bank's case the question in issue was whether a bank could claim to set off its business loss carried forward from past years against its current income from interest on securities. In the absence of any finding that the securities were held as part of the banking business of the assessee the Supreme Court remanded the case. The court was, however, more explicit in Chugandas & Co.'s case where the question was whether the interest on securities of which the assessee company was a dealer was its business income for the purpose of exemption from tax under Section 25(3). The Supreme Court observed that the heads of income described in Section 6 and further elaborated for the purpose of computation in Sections 7 to 10 and 12, 12A, 12AA and 12B are intended merely to indicate the classes of income. The heads do not exhaustively delimit the sources from which income arises. Business income is broken up under different heads only for the purpose of computation of the total income. By that breaking up the income does not cease to be the income of the business, the different heads of income being only the classification prescribed by the Income-tax Act for computation. In that case the Supreme Court held that the interest on securities was the assessee's business income for the purpose of Section 25(3). In the third case that of the Radhaswami Bank, which was a case under Section 24(2) of the Act, the head-note of the reports fairly represents a summary of the decision. In that case it was held that the assessee was entitled to set off the loss brought forward from the earlier assessment year against its entire income including the interest on securities in the succeeding years. Under Section 24(2) of the Indian Income-tax Act, 1922, the income from securities, which formed part of the assessee's trading assets, was part of its income from business and, therefore, the loss incurred in the business in the earlier years could be set off against the income from securities also in the succeeding years. It was further held that the scheme of the Income-tax Act is that income-tax is one tax. Section 6 of the Act classified the taxable income under different heads for the purpose of computation of the net income of the assessee. Though, for the purpose of computation of the income, interest on securities is separately classified, income by way of interest from securities does not cease to be part of income from business if the securities are part of the trading assets. Whether a particular income is part of the income from a business falls to be decided not on the basis of the provisions of Section 6 but on commercial principles. Section 24(2) is concerned with the business and not with the heads under Section 6 of the Act.
16. It was, therefore, submitted that the Commissioner's order was erroneous on the face of it as the two reasons given for the decision were not based on materials or records or arrived at as a result of any enquiry made but were merely the expression of his own opinion. The Commissioner failed to appreciate that the companies in which investments have been made are 100 per cent. subsidiary of the petitioner-company.
17. The learned counsel further submitted that the scope of the jurisdiction of the Commissioner under Section 33A has been explained by the Supreme Court in Dwarka Nath v. Income-tax Officer, : 57ITR349(SC) . In that case the Supreme Court observed that:
'Prima facie, the jurisdiction conferred under Section 33A(2) of the Indian Income-tax Act, 1922, is a judicial one. The order that is brought before the Commissioner affects the right of the assessee. It is implicit in revisional jurisdiction that the revising authority shall give an opportunity to the parties affected to put forward their case in the manner prescribed. The nature of the jurisdiction and the rights decided carry with them necessarily the duty to act judicially in disposing of the revision. ... A petition under Article 226 of the Constitution for a writ of certiorari to quash an order of the Commissioner under Section 33A(2) is maintainable.'
18. Mr. Ray pointed out that Section 24(2)(ii) was amended in 1955 by omitting the words 'same business' and substituting therefor 'any business, profession or vocation carried on by the assessee in that year provided that the same business was carried on in the latter year 'and that it was in the United Commercial Bank's case that for the first time the contention was raised that, though items of income may be computed under any of the other heads in Section 6, nevertheless they continued to be business income if they arose from the assessee's conduct of his business.
19. In this connection a comment by Mr. Ray should be noticed. Mr. Raypointed out that the petition under Section 33A was submitted in February 1958, but the Commissioner took no action till the 19th October, 1966. This long delay of eight years is attributed by Mr. Ray to the fact that. by its order dated 1st July, 1966, in appeal for the assessment years 1957-58 the Tribunal had directed that the claim for set off of business loss could not be defeated on the ground that it was not set off against the immediately succeeding year and directed the Appellate Assistant Commissioner to decide the appeal afresh. Mr. Ray alleged that the proceedings under Section 33A were resumed with the object of preventing the Appellate Assistant Commissioner from deciding the appeal on the lines as directed by the Tribunal.
20. In its application under Section 33A the petitioner made an alternative claim, namely, that in any event even if the loss from business for the earlier year could not be allowed as a deduction from the dividend income of the current year, at least that part of the loss consisting of the unabsorbed depreciation brought forward should be allowed and the decision of the Supreme Court in Jaipuria China Clay Mines (P.) Ltd. was relied on in support thereof. This again has been distinguished by the Commissioner on the ground that the allowance was made by the Supreme Court in that case because the unabsorbed depreciation entered into the computation of business income or loss of the current year and the resultant loss from the business loss was set off against the income computed under other heads of income in the same year. As in this case there was no business income in the current year the question of set off of unabsorbed depreciation brought forward did not arise. Mr. Ray submitted that the Commissioner's reading of the aforesaid decision of the Supreme Court was erroneous and contrary to the said decision of the Supreme Court.
21. Mr. Gupta, for the department pointed out that in the assessment year 1955-56 the petitioner had been assessed as a resident and ordinarily resident and consequently its total world income came into computation in the assessment and the loss arising from the business in the U.K. was set off against the dividend income in India for that year. In the two subsequent years 1956-57 and 1957-58 the petitioner had been assessed as a non-resident and the only income that had been taken into consideration was the assessee's Indian income from dividend. Its income or loss arising from any source outside India had neither been considered nor taken into computation. It was not even known to the Income-tax Officer whether in these two years the assessee had suffered any loss from its business in the U. K. and that the less carried forward from the earlier years was not set off against its profits from its business in any of the two subsequent years. Mr. Gupta frankly admitted that this aspect was not taken into consideration by the Commissioner while making the impugned order under Section 33A but contended that he was entitled to uphold the impugned order on grounds not considered or dealt with by the Commissioner.
22. Mr. Gupta referred to Section 24(2)(ii) and submitted that the operative words are 'set off against the profits and gains of business, profession or vocation carried on in that year'. This expression has now been interpreted to mean that the business, profession or vocation does not refer to heads of income but to all business or trading activities of the assessee. Therefore, there will be an enquiry as to whether the dividend income in India accrued or arose from the petitioner's trading activities or from any of its trading assets. It was for the petitioner to establish that the Indian income arises from its trading assets and not for the Commissioner to make enquiries and satisfy himself that such income arose from the trading assets of the petitioner's business. The impugned order shows that the Commissioner had considered the three decisions of the Supreme Court relied on by the petitioner before him and was conscious of the ratio laid down in these decisions. Therefore, there is no error of law or of any proposition of law in the order. He may be wrong in his interpretation of the Supreme Court's decisions. The only question, therefore, is whether his conclusion that the holding of the shares of the petitioner in the Indian company was not incidental to its business and as such the dividend income therefrom could not be business income was properly arrived at on a consideration of all materials available. Supporting materials for the petitioner's claim, according to Mr. Ray, were :
(1) the assertion made in the petition under Section 33A; (2) similar allegations in paragraph 2 of the writ petition and no specific denial thereof in the affidavit-in-opposition; (3) the recital in the order of the Tribunal; and (4) the alleged admission by the Commissioner in the reference application under Section 66(1).
23. Mr. Gupta pointed out that in the affidavit-in-opposition there was noadmission of the petitioner's claim but there was a denial that the department had accepted the dividend income as business income. In any eventthe assertions in the petition were not before the Commissioner. Neitherthe recital in the Tribunal's order nor the statement in the enclosure to theCommissioner's application under Section 66(1) amounted to any admissionas such enclosures were taken from the Tribunal's order and the Tribunalwas merely reciting what had been alleged by the assessee. Even in thewrit petition the petitioner has not alleged that it was an investor in theseshares so as to bring its case within the ratio of the two decisions of theSupreme Court in Chugandas & Co.'s case and Radhaswami Bank's case. Theonly other fact to be found in the records is that the majority of the shares held by the petitioner are in companies which are its subsidiaries. Whether this fact would be conclusive as to the character of the investment, i.e., whether such investments are necessary to carry on its business as a manufacturer and dealer of tea has to be established by cogent evidence which the petitioner has failed to do. No materials have been placed before the Commissioner in support of the petitioner's assertion that the shares were part of its trading assets or that the investment in these shares was part of its trading activities.
24. Mr. Gupta emphasised that it was not necessary for him to justify the order of the Commissioner. Certiorari would lie only to rectify an error of law. The Commissioner has not committed any error of law or applied any provision of law which was not relevant. It has been held that an erroneous decision on a question of fact is not amenable to the writ jurisdiction, only subject to the exception that where such a finding is based on no material at all, it could not be sustained. Mr. Gupta submitted that though that was the general law relating to the jurisdiction of this court to issue prerogative writs, in taxation matters the Supreme Court in Shivram Poddar's case has laid down a much more strict application of the aforesaid principles and this decision has not been dissented from by the subsequent decisions of that court.
25. Mr. Gupta finally submitted that even if the dividend income is held to be income from business it would only be an item in such income and no set off could be allowed against a part of the income from business. To allow such a set off the Income-tax Officer must find out the petitioner's income from all its businesses for that year. In the peculiar facts of this case, Section 24(2)(ii) was not attracted.
26. The learned counsel also submitted that the alternative argument that in any event the unabsorbed depreciation of the earlier year should have been allowed is equally untenable. Section 10 is the computing section for the head 'business.' There the deductions allowable are enumerated in Sub-section (2) of that section. Section 10(2)(vi), proviso (b), provides that unabsorbed depreciation brought forward shall be added to the allowance for depreciation for the following year and deemed to be a part of that allowance. So, it would appear that unabsorbed depreciation of any year becomes part of the depreciation for the subsequent years. If in the subsequent year no income under the head 'business' is chargeable to tax then there is no assessment under Section 10 and no question of any allowance under Section 10(2)(vi). In Jaipuria China Clay Mines case relied on by Mr. Ray, it was held that the unabsorbed depreciation became part of the depreciation of the current year and, therefore, the amount of such depreciation as not set off against the income from the business became business loss which must be set off against the income under other heads under Section 24(1). In this case no such business loss could be determined for the assessment year 1956-57 in the absence of any assessment under Section 10 and the aforesaid decision could have no application to the petitioner's case. Finally, it was submitted that in any event even if the Commissioner erred, the error did not affect either any jurisdiction vested in the Commissioner or affect any fundamental rights of the petitioner.
27. Mr. Ray in reply contended that Mr. Gupta could not rely on materials or grounds not considered by the Commissioner to sustain the validity of the impugned order. In this case the Commissioner was acting in a judicial capacity in dealing with the petitioner's claim. He was not adjudicating any dispute or controversy between two rival parties. He could either accept the facts alleged in the petition before him or he could have looked into the records or made enquiries or called upon the petitioner for such further or other materials as was necessary for his satisfaction. In this case the Commissioner had simply rejected the petitioner's contention arbitrarily without trying to satisfy himself as to the merits of the petitioner's case.
28. Though the matter has been argued at great length I think the real issues are within a narrow compass. No challenge as to the exercise of the jurisdiction by the Commissioner has been raised in the petition. In other words it has not been alleged that he has either exercised a jurisdiction not vested in him or had acted in excess of such jurisdiction or without any jurisdiction. The only contention is that the order passed under Section 33A was erroneous on the face of it, as it was arbitrary and contrary to the materials on record. The condition, as I have already stated, for the issue by this court of a writ of certiorari is whether there is an error of law, but not of fact, apparent on the face of the record, as for example, when it is clear that the conclusion of law arrived at by the inferior court or Tribunal is based on an obvious misinterpretation of a statutory provision or ignorance of it or disregard of it or for reasons erroneous in law. I do not think that any case has been made out of any misinterpretation of the provisions of Section 33A by the Commissioner or any disregard by him of any provision of law. The only question, therefore, is whether the reasons given by him in his order are erroneous in Jaw. I agree with Mr. Gupta that apart from the assertions made in the petition before the Commissioner and in the appeal before the Income-tax Appellate Tribunal that these shares were part of its trading assets no other material was placed before the Commissioner to come to the conclusion that the dividend income was the petitioner's income from business. Being a non-resident in the assessment years 1956-57 and 1957-58 the petitioner's business income in the U.K. did not come into the computation in its Indian assessment. Therefore, it could not be ascertained whether any business loss of 1955-56 was not set off against its business income in the U.K. in any of these two years. After all it is for the petitioner to satisfy the Commissioner that the shares held by it are part of its business assets and not for the Commissioner himself to find out that the petitioner's contention was correct. The Commissioner's interpretation of the decisions of the Supreme Court cannot be said to be arbitrary or erroneous on its face because the basic fact in all these cases before the Supreme Court was that the assessee carried on business in India and that the income arose from assets held for the purpose of its business though assessable under the heads other than business. That is the whole point at issue. Can it be said that the petitioner had produced sufficient materials or evidence to satisfy the Commissioner that the shares were part of its trading assets? And in refusing to accept this claim can the Commissioner be said to have acted arbitrarily or capriciously The answer must be in the negative to both questions. Further, the question whether these shares are held as the assessee's trading assets has been directed by the Income-tax Tribunal to be determined in the petitioner's appeal from its assessment for 1956-57 and the prescribed authority and the Tribunal are the proper forums before whom such a claim should be investigated. This court, in exercising its writ jurisdiction, cannot determine a question of fact. It can only rectify errors of law.
29. I also agree with Mr. Gupta that the question of allowance of unabsorbed depreciation would only arise when there is a computation of business income under Section 10 in the current year. If there is no assessment under Section 10 there could be no question of any allowance under the proviso to Section 10(2)(vi)(b). It could not, therefore, be said that the Commissioner has failed to appreciate the ratio of the decision in Jaipuria China Clay case.
30. The application is accordingly dismissed. The rule is discharged and all interim orders are vacated. There will be no order as to the costs of this application. Operation of this order is stayed till December 10, 1969.