Court : Mumbai
Decided on : Mar-19-1958
Reported in : AIR1959Bom281; (1958)60BOMLR1043; ILR1958Bom1184; 34ITR222(Bom)
..... now, what we said in navinchandra's case : 27itr245(bom) and what we had said earlier in kasturchand's case : air1950bom1 was that the income-tax act does not in terms prescribe a period of limitation for an order to be made under section 23a. that view, we think, is correct. but in neither ..... , it was necessary for the income-tax officer to initiate action under section 34 of the indian income-tax act in order to tax the deemed income distributed by virtue of the order under section 23a of the act? now, this question was considered in the case of navinchandra mafatlal v. commissioner of income-tax, bombay city : 27itr245 ..... manager which would not make an order under section 23a an dinfructuous order. it is pointed out that in kasturchand ltd. v. commr. of income tax bombay : air1950bom1 we held that no period of limitation was provided for an order to be made under section 23a and when it was urged ..... three assessees before us were shareholders in a.c.e.c. private (india) ltd. on the 29th of march, 1954, the income-tax officer passed an order under section 23a with regard to the profits of the company for the year 1949-50 and issued a notice ..... (bom) and the view we took there was that section 23a was not a section which dealt with assessment, and after an order under section 23a was made, it was necessary to assess the shareholders to tax .....Tag this Judgment!
Court : Mumbai
Decided on : Oct-03-1958
Reported in : AIR1959Bom421; (1959)61BOMLR380; ILR1959Bom1368
..... , as we shall point out, little later in our judgment, no judge has ever attempted to give a comprehensive definition of that expression. the income-tax act does not define the expression. this is just as well since it seems difficult to have a definition which may aptly meet with every particular instance ..... on this reference is:'whether on the facts and in the circumstances of the case, the assessee company is entitled to relief from tax under section 15c of the income-tax act?'2. it has been argued before us by mr. g.c. joshi, learned counsel for the revenue, that the tribunal was in ..... t. desai, j.1. a short but interesting question of construction of section 15c of the income-tax act arises for our determination on this reference, which come before us at the instance of the commissioner of income-tax bombay, under section 66(1). the facts may be briefly stated. a partnership firm consisting of ..... we are taking.10. there is some difference of judicial opinion about the canon of construction application to a provision for exemption in a taxing statute. in commissioner of income-tax bombay v. chugandas and co., it ref. no. 27?x of 1954 (bom) my brother tendolkar and 1, although we took different ..... to held the building up of new industries, it has been provided that industries stated after 1-4-1948 will get some special benefits. the income-tax officer would have been right in not allowing the exemption if the business taken over by the assessee had been commenced prior to 1-4-1948 .....Tag this Judgment!
Court : Mumbai
Decided on : Oct-08-1958
Reported in : AIR1959Bom427; (1959)61BOMLR393; ILR1959Bom1342
..... is for the assessee to conduct his business, and in his wisdom or otherwise to fix the remuneration to his staff. the income-tax act does not clothe the taxing authority with any power or jurisdiction to determine the reasonableness of the amount so fixed and paid by the assessee. the only ..... paid, or because the expenditure is not solely and exclusively for the business, and not on the ground that in the opinion of the income-tax officer or other taxing authority the remuneration is 'unreasonably' high either because the employee does not, in the authority's opinion, deserve so much, or because ..... business.7.mr. kolah, learned counsel for the assessee, has relied on a decision of the madras high court in newton studios ltd. v. commissioner of income-tax, madras : 28itr378(mad) . that case related to payment of remuneration to a member of the staff of the assessee but the principle is ..... the purpose of the business even though it may not be incurred with a view to making profits. in eastern investments ltd. v. the commissioner of income-tax, west bengal : 20itr1(sc) , the supreme court laid down that in the absence of fraud, the questions whether the transaction had the ..... deduction. in this reference we are not concerned with the payment of rs. 1,34,400/- made by the assessee company to mr. captain. the income-tax officer disallowed the assessee's claim for this deduction. the appellate assistant commissioner, however, allowed the assessee company a deduction of rs. 33,600/. .....Tag this Judgment!
Court : Mumbai
Decided on : Oct-10-1958
Reported in : AIR1959Bom431; (1959)61BOMLR399; ILR1959Bom1438; 36ITR124(Bom)
..... we must read as 'tax on the income of a deceased person' postulates that the income was the income of the deceased person. therefore, what cannot be said to be the income of a deceased person is outside the purview of this section, which is the only provision in the income tax act which deals with the income of a person who dies without paying income-tax in respect of the ..... . ordinarily, what would have been the income of a deceased person, when received by an executor, administrator or other legal representative would be ..... same.8. faced with this difficulty, learned counsel sought to derive support form the words at the end of the section viz. 'or any tax which would have been payable by him under this ..... it could not have been the intention of the legislature to allow income of the type before us to escape assessment. but we are not concerned with the supposed intention of the legislature, which is at times extremely difficult to ascertain and particularly in case of some provisions of the income tax act. we are concerned with what the legislature has said it meant .....Tag this Judgment!
Court : Mumbai
Decided on : Oct-06-1958
Reported in : AIR1959Bom454; (1959)61BOMLR386; ILR1959Bom1350; 35ITR734(Bom)
..... share of the profit he may get from the firm, and the value of the shares was, therefore, assessable as the assessee's income under section 10 of the income-tax act, one of the contentions in that case was that the receipt was of the nature of a casual and non-recurring receipt. that ..... the purpose of assisting his employee, whom he does in fact remunerate for his services, attempts to relieve his employee from his obligation to pay income tax by saying 'i do not intend it to be a remuneration'; even so the receipt becomes a taxable receipt if on all the facts of ..... with the principle laid down in that case. 10. the next case to which mr. kolah has drawn our attention is david mitchell v. commissioner of income tax, west bengal : 30itr701(cal) . in that case the assessee was an accountant by profession and a partner in a firm of chartered accountants. ..... as compensation for loss of employment and not by way of remuneration for past services;.....' 4. the appellate assistant commissioner confirmed the order passed by the income-tax officer. the matter was carried by the assessee in appeal to the tribunal and the tribunal dismissed the appeal. the tribunal in its order laid ..... contention also was dismissed by the court. 11. mr. kolah has also drawn our attention to a decision of the house of lords: reed (inspector of taxes) v. seymour, (1927) 11 tax .....Tag this Judgment!
Court : Mumbai
Decided on : Dec-18-1958
Reported in : (1959)61BOMLR847
..... the affirnative whilst mr. justice tendolkar has answered the question in the negative. the decision of the court, having regard to the provisions of s. 66a of the indian income tax act, 1922 is that the question is answered in the affirnative.(22) the applicant to pay the costs. costs to include the costs of the hearing before mr. justice tendolkar ..... was not a unit of assessment under the indian income tax act of 1918. what the legislature intended to convey was any business, on the income profits and gains whereof tax was at any income profits and gains whereof tax was at any time charged under the indian income tax act of 1918. section 2(4) of the indian income tax act of 1922 lays down that unless there is anything ..... thereafter which would have to be shown under the head proftis and gains of business, profession or vocation covered by section 10 even under the indian income tax act of 1918, if an assessee derived from income, profits and gains from a business carried on by him, he was under an obligation to show the interest received by him from securities which constituted ..... contends that when the legislature used the words any business, profession or vocation on which tax was at any time charged under the provisions of the indian income tax act,. 1918 it refered only to tax on income under the head income derived from business falling under section 9 of the indian income tax act, 1918 and on income under the head profession earnings, falling under section10 of the said .....Tag this Judgment!
Court : Mumbai
Decided on : Oct-23-1958
Reported in : AIR1959Bom499; (1959)61BOMLR582; ILR1959Bom1444; 36ITR266(Bom)
..... . 662 of the report (itr): (at p. 341 of air) it is observed:'now, as has often been pointed out, the assessable entity under the income tax act is different from a legal entity. the object of the income-tax act is to spread its net wide and to include in that net every person and every association of persons, however that association may have been ..... firm. according to the accountant member, in the case of an unregistered firm, the loss can only be carried forward in the account of the firm as provided under the income-tax act. the assessee had also relied upon an order of the tribunal made on 11-9-1952 in the matter of the assessment made on damji laxmidas for the same preceding ..... business when the unregistered firm has not been assessed. it has been argued before us by mr. kolah that there is no provision in the income-tax act which lays down that a person who carries on his own business and is also a partner in an unregistered firm cannot in any case claim to set-off his ..... of the share of a partner in the profits of an unregistered firm in his total income simply on the ground that the unregistered firm had not been first assessed to tax. it was also pointed out in that case that there is no provision of the income-tax act which prohibits the assessment of a partner until the firm in which he is a .....Tag this Judgment!
Court : Mumbai
Decided on : Mar-24-1958
Reported in : 34ITR265(Bom)
..... supreme court which throws some light on this question and that is in eastern investments ltd. v. commissioner of income-tax. the supreme court was considering section 12(2) of the income-tax act and the deduction permissible under that sub-section is in respect of 'expenditure incurred solely for the purpose of making ..... or earning such income, profits or gains' and mr. justice bose, at page 4, lays down various principles for deciding ..... chief justice of madras, in a full bench sitting with mr. justice wallace and mr. justice beasley, interpreting this very section in commissioner of income-tax v. somasundaram, takes the view that 'if necessary, i should be prepared to hold that the only reasonable construction of the section is to ..... the purpose of the business. 7. mr. joshi lays strong reliance on the judgment of this court in machinery manufactures corporation v. commissioner of income-tax. in that case we were construing an entirely different sub-clause of section 10(2) and that was sub-clause (vi); and what he ..... learned lord president rightly poses the question in all these cases of deductions that 'the rules framed in england', and the sections in our act, 'are only guides because the real point is what are the profits and gains of the business'. therefore, if a businessman borrows money to .....Tag this Judgment!
Court : Mumbai
Decided on : Mar-24-1958
Reported in : 34ITR336(Bom)
..... not apply to the case of a sale of under section 10(2)(vii). it must apply to all cases of sale dealt with under the indian income-tax act, unless there is something in the section itself which makes it clear that the sale contemplated by the legislature is not only a sale where according to ..... the difference between rs. 4,85,354 and rs. 3,81,848 by reason of the second proviso to section 10(2)(vii) of the income-tax act. 2. turning to section 10(2)(vii), it deals with depreciation; and the second proviso is in the following terms : 'provided further that ..... transfers it to himself, he cannot make profit either real or notional. these principles which we are enunciating were very clearly and emphatically enunciated in commissioner of income-tax v. sir homi mehta's executors. mr. joshi does not like these principles; but for good or for evil they are there till a higher court ..... the application of the second proviso to section 10(2)(vii) 5. now, it is elementary that a person cannot sell to himself for the purpose of income-tax, because a person cannot make profit out of himself. the basic idea underlying section 10(2)(vii) is that the vendor has made profit by the ..... depreciation. now, the importance of this decision - if it has any - is that we considered whether a particular transaction constituted a sale for the purpose of taxing law and we drew a distinction between sale in a technical, legalistic sense and sale from a commercial point of view as representing a real transaction. if .....Tag this Judgment!
Court : Mumbai
Decided on : Mar-31-1958
Reported in : 34ITR409(Bom)
..... 325 : 'for the purpose of assessment, there is a well marked distinction between discontinuance and succession - a distinction which is recognised in the english law of income-tax and adopted provided for in the indian income-tax act. the conception of succession therefore excludes the conception of discontinuance.' 4. apart from our decision turning on the clear language used by the legislature in section 44 ..... plain meaning of the section and to be in line with similar decisions upon the english income tax acts.' 3. there is also a judgment of the madras high court reported in karuppiah pillai v. commissioner of income-tax, madras also took the view that section 44 of the indian income-tax act only applies when there has been a discontinuance of a business, and that when a ..... of the profits of the four partners were allocated to each one of them under the provisions of the income-tax act and each of the partners was assessed to tax on his share of the profits. the petitioner and the other three partners paid the tax which they were liable to pay in respect of their respective assessment. iyer failed to do so and ..... chagla, c.j. 1. this petition raises a question as to the proper construction of section 44 of the income-tax act. the question comes to be raised under the following circumstances. the petitioner was a partners with there others in the firm of e. loeffler & co. which was constituted on the .....Tag this Judgment!