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TMI Blog1946 (8) TMI 24X X X X Extracts X X X X X X X X Extracts X X X X ..... ward from the assessment for 1940-41 against the profits from speculation in New York cotton considered in the assessment for 1941-42, under Section 24(2) of the Indian Income-tax Act, 1939? Sub-section 24(2) is in these terms:- Where any assessee sustains a loss of profits or gains in any year, being a previous year not earlier than the previous year for the assessment for the year ending on the 31st day of March, 1940, under the head 'Profits and gains of business, profession or vocation', and the loss cannot be wholly sec off under sub-section (1), the portion not so set off shall be carried forward to the following year and set off against the profits and gains, if any, of the assessee from the same business, profession or vocation for that year . There follows a provision for a still further carry forward. The material words, which are to be noted, are that it muss be from the same business, profession or vocation . In their judgment the Appellate Tribunal commenced in paragraphs 1 and 2 by stating the facts which are as follows- 1.This appeal relates to an assessment made upon the appellant company for the charge year 1 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... atements found in the statement of the case appear to be conflicting. In paragraph 3 it has stated : 'A part of the assessee's business is speculation in wheat, linseed, silver and cotton'. To words the end of paragraph 5 it has stated: 'We held that speculation in silver, wheat and linseed and that in New York cotton were not the same business within the meaning of the section'. It may be noted that at this stage also the Tribunal has omitted to notice the word 'cotton' in describing the nature of the business of the assessee, as it had first described . The supplemental case returned to us by the Tribunal, and which is now before us is highly unsatisfactory. The Tribunal appear to be far more concerned with excusing the statements of fact in the first case, which are unquestionably contradictory, than with complying with the directions of this Court given under Section 66(4) of the Income-tax Act. In the supplemental case the Tribunal states : We have recorded a clear finding that in account year, 1939, the assess' business relevant to the question was in wheat, linseed and silver only, while that in 1940 was in cotton . And finally they ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... plicants consisted of speculation indifferent markets in different commodities. It may be that in any particular accounting year the applicants may not have speculated in any particular market or in any particular commodity but that was because the applicants thought it not advisable or expedient to do so during the particular accounting year. From the commencement speculation business in different markets and indifferent commodities constituted one and the same business of the applicants. In proof of the fact that the applicants' dealings in several markets in different commodities form part of the same business I produce the following evidence. One of the objects of the incorporation is to carry on speculation business in any part of the world in any commodity. For brevity's sake I crave leave to refer to the memorandum and articles of the company when produced. Speculation business is one unified and organised activity of the applicants. Speculation business is carried on with the same staff and with the aid of the same account? and in the same premises. The nature of all speculative business is the same and the difference in commodities or the difference in the markets ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... we are very reluctant to send this matter back once again to the Tribunal to comply with our directions given on the 12th October, 1944, and in view of Mr. Setalvad's statement on behalf on the Commissioner, that he accepts the affidavit of Mr. Brijlal as being uncontroverted, we are prepared to proceed with the matter. Mr. Setalvad has submitted that there is no such thing as the business of a speculator and that the position must be regarded as if the assessee company is carrying on separate businesses as dealers on the New York Cotton Exchange and as dealers on the Bombay Bullion Exchange. But there is no evidence of this. On the other hand, I can see no reason why a person, provided he conducts himself in a lawful manner, should not carry on the business of speculating in futures. One of the dictionary meanings of speculation is an act or instance of speculating : a commercial venture or undertaking of an enterprising nature especially, one involving considerable financial risk on the chance of unusual profit , (see Oxford Dictionary, New Series, Vol. IX, page 559). The fact that in a particular year the assessee company as a speculator does not happen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ction 24, sub-section (2), of the Act is a question of fact, and it is for the Tribunal to find that fact. Unfortunately in this case the Tribunal has deliberately ignored important pieces of evidence that were placed before it in the form of the affidavit to which the learned Chief Justice has referred. Although in the judgment of Mr. Justice Kania the Tribunal was given liberty to call further evidence to arrive at its finding of fact, it refused to take the materials contained in the affidavit into consideration. The question is whether apart from those materials contained in the affidavit there is any other evidence on the record which would justify the finding of fact arrived at by the Tribunal. Now Mr. Justice Rowlatt in the case to which the learned Chief Justice has just referred (Scales case (supra)) has laid down the test which should be applied in order to determine whether two businesses are separate businesses or are the same business. There must be, as the learned Judge observes, an inter-connection, an inter-lacing and an inter-dependence between the two businesses and there must be a unity embracing the two businesses. Now, with great respect to the learned Chief Ju ..... X X X X Extracts X X X X X X X X Extracts X X X X
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