1940 (9) TMI 23

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..... e Income-tax Officer's order of assessment was revised by the Commissioner of Income-tax, who assessed the income at ₹ 31,384. Included in this amount was the figure of ₹ 9,000 which the Commissioner said was the amount of profit which had accrued to the assessee in British India from this business. The Commissioner considered that the assessee had bought the animals at lower prices than those disclosed in his invoices when shipping them to Colombo. The assessee objected to an assessment on this basis and asked the Commissioner to state a case to this Court. The Commissioner refused, but was compelled to do so by an order of this Court, dated the 17th October 1939. In pursuance of this Court's direction the Commissioner .....

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..... Commissioner is also fallacious. Because exporters, when they sell at F.O.B. prices, include in these prices their profit does not mean that in a case like the present one a profit is included. When this case is examined it is manifest that the prices at which the animals were invoiced to Colombo would make no difference in the calculation of the profits made by the assessee. There is no evidence for the year of assessment that the assessee charged his Colombo office greater amounts than the cost to put the animals on board the steamers, but assuming that the invoices had been inflated that would not make any difference. The profit made by the assessee could only be calculated on what the goats and sheep actually cost him and the amounts a .....

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..... income-tax on his profits made abroad. There is a vast difference between that case and the case now before us and the cases which do apply are The Madras Export Co.'s case (supra)and Jiwan Das's case (supra). For these reasons I would answer the question referred in the negative and award costs to the assessee in the sum of ₹ 250. The assessee is also entitled to the refund of his deposit. It is necessary to draw attention to another matter connected with this reference. When the case came before this Court on the question whether the Commissioner should be compelled to state a case it appeared that the Income-tax authorities were contending that the assessee's assessment might be increased by the ₹ 9,000 on the .....

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