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TMI Blog1969 (10) TMI 17X X X X Extracts X X X X X X X X Extracts X X X X ..... Act ". The statement of the case relates to the assessment year 1959-60, the corresponding previous year being the period from the 1st May, 1957, to the 30th April, 1958. The assessee, who is the applicant in this case, is a private limited Company. It acquired 10,000 shares of Messrs. Rampur Commercial Corporation Ltd., hereinafter referred to as the " managed-company " in the year 1945, for the value of Rs. 5 each. In the same year the assessee-company acquired the managing agency of the managed-company. On the 20th of January, 1958, the assessee-company applied for transfer of the entire lot of 10,000 shares to Messrs. Oriental Engineering and Commercial Corporation, Calcutta, and eventually transferred the entire lot shares on the 7t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in shares in the assessment for the year 1961-62. On these considerations the Appellate Assistant Commissioner was of the view that dealings in shares formed part of the assessee's regular business and, therefore, the loss in question was a revenue loss. The Appellate Assistant Commissioner, therefore, allowed the sum of Rs. 7,500 as an admissible deduction. Against the order of the Appellate Assistant Commissioner an appeal was preferred by the Income-tax Officer before, the Appellate Tribunal., The Appellate Tribunal found that the crucial question for determination was whether the assessee was a dealer in shares. The Tribunal found that quite a lot of shares were acquired by the assessee during the accounting years from 1945-46 to 1958 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s of other companies on the 15th of April, 1957. The Tribunal, however, found that the assessee had been acquiring shares year after year from the accounting year 1945-46 to 1958-59 and the first sale of any shares took place in the accounting year under appeal. According to the facts found by the Tribunal, therefore, there was no sale of any shares on the 31st of March, 1957, as found by the Appellate Assistant Commissioner. Mr. V. Swarup, appearing for the assessee-applicant, contended that in view of this divergence a supplementary statement might be called for from the Tribunal under section 66(4) of the Act. We do not, however, see that any useful purpose would be served by doing so. In the first place, Mr. Swarup does not dispute the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the object of acquiring the managing agency of the managed-company. In the case of Kishan Prasad and Co. v. Commissioner of Income-tax, the Supreme Court held, in a similar case, that shares purchased by the assessee for three lakhs of rupees to acquire the managing agency of a sugar mill was in the nature of an investment. In that case also, as in the present case, the memorandum of association of the assessee-company authorised it to deal in shares and other securities. The Supreme Court observed that the circumstance as to whether a transaction is or is not within the company's powers has no bearing on the nature of the transaction or on the question whether the profits arising therefrom are capital acquisition or revenue income. To the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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