Court : Mumbai
Decided on : Oct-04-1958
Reported in : AIR1961Bom5
..... have never been used with reference to the accounting year. he has also referred me to the notice of demand issued in pursuance of the provisions of the income-tax act wherein also the words 'income for the year ending 31st march 1952' have been used with reference to the assessment year and not the accounting year. it is unnecessary to quote here all ..... order1. this is a petition under article 226 of the constitution challenging the validity of notice dated april 2nd, 1957 issued in pursuance of section 34 of the income-tax act and for reliefs preventing the respondents from proceeding with re-assessment in pursuance of that notice. 2. the main grounds on which the petitioner has placed reliance are contained in ..... of messrs. durgaprasad ramcharan private ltd. he had according to him during that period two sources of income. in accordance with the provisions of the income-tax act, he was duly assessed to income-tax in respect of the said period. 5. some time in 1956-57 the income-tax officer had information that in 1950 there were three home savings deposit accounts in jodhpur commercial bank, bombay ..... before the court was 'whether in the circumstances of this case the notice of reassessment issued to the applicant under section 34 of the income-tax act was invalid or illegal for failure to specify that particular source of income that had escaped assessment?' 22. it is necessary before referring to the judgment of beaumont c. j. in that case to observethat in 1939 .....Tag this Judgment!
Court : Mumbai
Decided on : Mar-25-1958
Reported in : AIR1959Bom93; (1958)60BOMLR1046; ILR1958Bom1213
..... a.c. must be exercised within a specific period, then the legislature would have so provided. but we look in vain for any provision in the income-tax act which lays down any period of limitation for the exercise of the appellate powers of the a.a.c. in our opinion, in exercising his discretion ..... second question is whether the addition of the sum of rs. 1,50,000/- by the appellate assistant commissioner was barred by section 34(3) of the income-tax act? now, the contention urged by mr. palkhiwalla is that section 34(3) lays down a period of limitation for making an order of assessment and that ..... the a.a.c. to exercise that power at any time.5. mr. palkhiwalla has referred to a judgment of the lahore high court, commr. of income-tax v. shah nawaz khan, reported in (b). that was a case which dealt with entirely different facts, and the principle which can be deduced from that ..... . would be debarred, according to mr. palkhiwalla, from making any order to the prejudice of the assessee which might result in the assessment made by the income-tax officer being increased. this is not a case of enhancement, and even though it is not a case of enhancement, mr. palkhiwalla argues that merely because ..... in the books of the assessee. the assessee appealed to the appellate assistant commissioner. the a.a.c. held in favour of the assessee that the income-tax officer was not justified in adding these two sums. but on looking to the accounts, he found that two items of sales had not been accounted for .....Tag this Judgment!
Court : Mumbai
Decided on : Mar-20-1958
Reported in : AIR1959Bom148; (1958)60BOMLR851; ILR1958Bom1188
..... m.c. chagla, c.j.1. the question that arises in this reference is whether an income arising from a certain trust is exempt from tax on the ground that it falls within section 4 (3) (i) of the indian income-tax act. the trust in question was constituted on the diamond jubilee of mr. walchand hirachand, a well-known ..... purpose, them even the intervening period the trust continues to be a charitable trust the property is held on a charitable trust and the income from that trust is exempt from tax. 4. the second objection that is raised by mr. joshi is as regards the power conferred upon the trustees to prefer the employees ..... be carried out. if mr. joshi were right, no such trust could be set up, or if it were set up, the income from such a trust would have to pay tax. what has to be looked at is the dominant intention disclosed in the trust-deed. it is not necessary that the intention must be ..... which he helped to build up should be conducted in a particular manner, those are all side issues which do not affect the question of property or income. they undoubtedly help us to understand what the intention of the settlor was; and although it may be conceded that he was greatly interested in the employees ..... immediately carried out. so long as the income from the trust property is not spent on any non-charitable object and it is saved .....Tag this Judgment!
Court : Mumbai
Decided on : Mar-24-1958
Reported in : AIR1959Bom156; (1958)60BOMLR856; ILR1958Bom1207
..... court which throws some light on this question and that is in eastern investments ltd. v. commr. of income-tax : 20itr1(sc) . 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 (of itr): (at p. ..... learned chief justice of madras, in a full bench sitting with mr. justice wallace and mr. justice beasly, interpreting this very section in commr. of income-tax v. somasundaram air 1928 mad 487, takes the view that 'if necessary, i should be prepared to hold that the only reasonable construction of the ..... was used for the purpose of the business.6. mr. joshi lays strong reliance on the judgment of this court in machinery . v. commr. of income-tax : air1957bom14 . in that case we were construing an entirely different sub-clause of section 10(2) and that was sub-clause (vi); and what ..... . in that case the assessee bank spent monies in investing the funds of the bank in certain securities which yielded interest which was free from tax, and the contention of the crown was that the bank was not entitled to deduct the expenses of investment because the securities which were purchased .....Tag this Judgment!
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-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 : 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!