9911796707
TMI Blog1987 (4) TMI 7X X X X Extracts X X X X X X X X Extracts X X X X ..... , inter alia, a sugar factory at Bijnore. In 1930, there was a partition in the family and the members of the erstwhile joint family constituted themselves into a partnership firm which took over the sugar factory and operated the same. In the year 1944, Sheo Prasad, one of the brothers, who was a partner of the firm instituted a suit in the Lahore High Court for dissolution of the firm. Partition of the country followed and after the parties shifted over to India, a fresh suit was instituted at Bijnore for purposes of partition. The properties were put in charge of a receiver appointed by the court. So far as the sugar factory was concerned, the arrangement was that at five yearly rests, an auction was to be held confined to the partners a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ioner gave notice to the assessee and disallowed the same. The Appellate Tribunal reversed the finding of the Appellate Assistant Commissioner in regard to the admissibility of the claim. Then, the assessee as also the Revenue applied to the Tribunal to refer the case to the High Court. As far as relevant, the following questions were referred for the opinion of the High Court under section 66(1) of the Act at the instance of the assessee: "(1) Whether, on the facts and in the circumstances of the case, the sums of Rs. 16,000 and Rs. 39,262 received from Kanshi Ram and Devi Chand, respectively, were assessable as income of the assessee ? (2) Whether, on the facts and in the circumstances of the case, depreciation is allowable on the 1/6th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... onal share in the machinery. On the other hand, Mr. Brij Lal Gupta appearing for the Department urged that ownership of a fractional share in machinery does not attract clause (vi). The point is not free from difficulty. " The High Court ultimately came to hold : " In order to qualify for an allowance under clause (vi), the claimant must make out that the machinery is the property of the assessee. That test is not satisfied by the present assessee. The assessee does not claim to be the full owner of the machinery in question. All that is claimed for the assessee is 1/6th share in the machinery. Such a fractional share will not suffice for granting an allowance for depreciation under section 10(2)(vi) of the Act. " We have heard learned c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... been confined to two questions as would appear from the order granting the certificate namely, as to whether one of the instalments received from the assessee out of the said amount of Rs. 68,000, as referred to above, in respect of an earlier assessment year constituted a taxable receipt. The second question relates to acquisition of the 1/6th share under a deed of exchange from Devi Chand under the exchange deed dated July 16, 1948, which indicated that the valuation of that interest was shown to be Rs. 4,50,000 and depreciation was claimed in regard to it. Both the questions raised here are covered by our aforesaid judgment. The appeal of the assessee has, therefore, to fail. The appeal is accordingly dismissed. Parties are directed to b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rt referred to section 24 of the Income-tax Act of 1922 and indicated that two conditions had to be fulfilled before the claim of tse off of carried forward loss could be admitted: firstly, the income against which the loss has to be set off should be income from business and, secondly, the business should be the same in which the loss was suffered. The High Court referred to certain decisions including the one of this court in Narain Swadeshi Weaving Mills v. CEPT [1954] 26 ITR 765 and ultimately negatived the claim of the assessee by saying that the question would not arise because the letting out of the sugar mill was not the business of the assessee. In fact, the receiver was appointed for dissolution of the firm and the main reason, as ..... X X X X Extracts X X X X X X X X Extracts X X X X
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