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TMI Blog1971 (10) TMI 23X X X X Extracts X X X X X X X X Extracts X X X X ..... year 1960-61 he sustained a business loss of Rs. 47,059 but gained capital gains during the year. Though the Income-tax Officer determined such capital gains at one figure, on appeal, the capital gains had been reduced to a sum of Rs. 75,000. On the basis of the order of the Appellate Assistant Commissioner, the respondent recomputed the income for the assessment year 1960-61 as follows : Rs. Property: 1,118 Share income (Loss) 47,059 Other sources: 1,312 ---------------- Net loss 44,629 ----------------- Capital gains 75,000 ------------------ Total capital gains 30,371 ------------------- Rs. Income-tax on Rs. 30,371 @ 4.2536 1,291.86 Surcharge 64.59 Special surcharge 193.77 ------------------- Total capi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... l income as reduced by the amount of such inclusion, had such reduced income been his total income, plus (ii) on the whole amount of such inclusion, income-tax equal to the amount which bears to the income-tax which would have been payable on his total income as reduced by two-thirds of the amount of such inclusion the same proportion as the whole amount of such inclusion bears to such reduced total income." We are not concerned with the proviso and, therefore, it is not extracted. Sub-clause (6) of section 17 is divided into two parts. Section 17(6)(i) expressly relates to income-tax and super-tax payable on the total income of the assessee as reduced by the amount of capital gains. In addition to such taxes so ascertained under the fi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ff against the loss incurred by the assessee. In the instant case, such an amount would be Rs. 30,371. It is not in dispute that the rate applied on Rs. 30,371 is in any way incorrect, but what is suggested is that " on the whole amount of such inclusion " cannot be Rs. 30,371 at all. To illustrate, it is said that if strictly the language has to be understood in the ordinary sense then no tax is payable in the instant case at all. The contention runs: If the loss is X and if the capital gain is Y (Y greater than X), then it is said that under sub-clause (i) of section 17(6), the total income should be ascertained as-X plus Y-Y, which is again a minus and, therefore, no tax is payable under that particular sub-clause. Then coming to sub-cla ..... X X X X Extracts X X X X X X X X Extracts X X X X
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