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Case Laws
Showing 21 to 25 of 25 Records
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1964 (5) TMI 5
Whether the amounts received by the appellant as compensation for loss of agency are of the nature of capital or revenue?
Held that:- On a careful consideration of all the circumstances we agree with the High Court that cancellation of the contract of agency did not affect the profit-making structure of the appellant, nor did it involve a loss of an enduring trading asset: it merely deprived the appellant of a trading avenue, leaving it free to devote its energies after the cancellation to carry on the rest of the business, and to replace the contract lost by a similar contract. The compensation paid, therefore, did not represent the price paid for loss of a capital asset. Appeal dismissed.
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1964 (5) TMI 4
Whether compensation received by an agent for premature determination of the contract of agency is a capital or a revenue receipt?
Held that:- In the present case, on a review of all the circumstances, we have no doubt that what the assessee was paid was to compensate him for loss of a capital asset. It matters little whether the assessee did continue after the determination of its agency with the Fort William Jute Co. Ltd. to conduct the remaining agencies. The transaction was not in the nature of a trading transaction, but was one in which the assessee parted with an asset of an enduring value. We are, therefore, unable to agree with the High Court that the amount received by the appellant was in the nature of a revenue receipt.
We accordingly record the answer on the question submitted by the Tribunal in the negative. Appeal allowed.
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1964 (5) TMI 3
Whether the Free Press Company made a business profit of ₹ 2,14,090 under the proviso to section 10(2)(vii) of the Act ?
Whether the capital gain made by the Free Press Company is liable to be assessed in the hands of the Express Company, under section 26(2) of the Act ?
Held that:- The first item is not liable to tax and the High Court has given the correct answer to the first question submitted to it.
As we have held, the scope of sub-section (2) of section 26 is only limited to the income from the business, the share under sub-section (2) and the assessment and realisation under the proviso can only relate to the income from the business. The argument is really begging the question itself. In the result we agree with the High Court in regard to the answer it has given in respect of the second question. Appeal dismissed.
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1964 (5) TMI 2
Whether there were materials for the Tribunal to hold, that the assessee is a banking concern assessable under section 10 for all the assessment years and not exempt ?
Held that:- It is difficult to hold that Styles' case applies to the facts of the case. A shareholder in the assessee-company is entitled to participate in the profits without contributing to the funds of the company by taking loans. He is entitled to receive his dividend as long as he holds a share. He has not to fulfil any other condition. His position is in no way different from a shareholder in a banking company, limited by shares. Indeed, the position of the assessee is no different from an ordinary bank except that it lends money to and receives deposits from its shareholders. This does not by itself make its income any the less income from business within section 10 of the Indian Income-tax Act. The answer to the question referred to the High Court should be in the affirmative.
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1964 (5) TMI 1
Issues Involved:
1. Legality of the notice dated January 30, 1963, under Section 210 of the Income-tax Act, 1961.
2. Validity of demanding the entire advance tax by March 1, 1963, in contravention of Section 211(1) of the Income-tax Act, 1961.
3. Effect of the provisional assessment made after the filing of the writ petition on the validity of the advance tax notice.
Detailed Analysis:
Issue 1: Legality of the Notice Dated January 30, 1963, Under Section 210 of the Income-tax Act, 1961
The petitioner contended that the notice of demand dated January 30, 1963, was illegal because it was based on an assessment order dated December 31, 1962, which was alleged to be a provisional assessment and not a regular one. The court examined the nature of the assessment order dated December 31, 1962. The petitioner argued that the use of the word "provisional" in the assessment order indicated it was not a regular assessment. However, the court clarified that the assessment order dated December 31, 1962, was indeed a regular assessment for the year 1958-59 and not a provisional one. The court noted that the term "provisional" was used because the assessment of the petitioner's share in certain firms was pending, and the Income-tax Officer had no alternative but to make a provisional determination of that share. The court cited precedents, including the Supreme Court's decision in Second Additional Income-tax Officer, Guntur v. Atmala Nagaraj, and a Bench decision in Dharam Vir Virmani v. Commissioner of Income-tax, to support its conclusion. Therefore, the court found no merit in the petitioner's contention regarding the illegality of the notice.
Issue 2: Validity of Demanding the Entire Advance Tax by March 1, 1963, in Contravention of Section 211(1) of the Income-tax Act, 1961
The petitioner argued that the notice was invalid because the income-tax authorities demanded the payment of the entire advance tax by March 1, 1963, instead of March 15, 1963, as per the proviso to Section 211(1) of the Income-tax Act, 1961. The court examined the provisions of Section 211 and noted that the petitioner had raised this objection before the income-tax authorities, who had responded by stating that the advance tax for the share of income ending after December 31 was payable by March 15, while the tax for the remaining income was payable by March 1. The authorities had even allowed the petitioner to pay the entire demand by March 15 to avoid unnecessary controversy. The court found no legal provision or precedent to support the petitioner's contention that the department could not change the date of payment. The court also noted that this point was not initially raised in the writ petition but was later included in the replication. Consequently, the court found no basis for interference on this ground.
Issue 3: Effect of the Provisional Assessment Made After the Filing of the Writ Petition on the Validity of the Advance Tax Notice
The petitioner argued that the provisional assessment made on January 15, 1964, for the financial year 1962-63 rendered the advance tax notice dated January 30, 1963, infructuous. The court examined the timing and legal implications of the provisional assessment. It noted that the advance tax notice is issued during the financial year, while the provisional assessment is made in the subsequent assessment year after the assessee submits their return. The court found no provision of law or judicial decision to support the petitioner's claim that the provisional assessment invalidated the advance tax notice. The court emphasized that the petitioner had become an assessee in default long before the provisional assessment was made. Therefore, the court found no merit in this contention as well.
Conclusion
The court dismissed the petition, finding no merit in any of the contentions raised by the petitioner. The court also noted the petitioner's conduct in delaying the payment of tax and failing to avail the statutory remedies provided under the Income-tax Act. Consequently, the writ petition was dismissed without any order as to costs.
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