9911796707
TMI Blog1968 (7) TMI 90X X X X Extracts X X X X X X X X Extracts X X X X ..... 09) ; Seaham Harbour Dock Co. v. Crook ([1931] 16 T. C. 333, H. L. sub nom. Evans Medical Supplies v. Mori) ; Edwards v. Bairstow ([1956] A. C. 14 ; [1955] 3 W. L. R. 410; arty, 37 T. C. 540 ; [1959] 35 I.T.R. 707, [1955] 3 All E. R. 48 ; 36 T. C. 207 ; H. L [1955] 28 I.T.R. 579, H. L) ; and Royal Insurance Co. Ltd. v. Stephen ([1928] 14 T. C. 22. sub nom. Jeffrey v. Rolls Royce, 40 T. C. 443 ; [1965] 56 I.T.R. 580, H. L.). Cur. adv. vult. July 22. PLOWMAN J. This is an appeal by British-Borneo Petroleum Syndicate Ltd. (which I shall call the company ) against assessments to income tax Schedule D for 1965-66 and profits tax for the chargeable accounting period April 1, 1964, to March 31, 1965. It is common ground that the decision ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mmissioners, whose view of the matter is expressed as follows : We think that there can be no doubt that the royalty agreement, when it was first entered into, was stock-in-trade of the appellant, and had it been disposed of at that time the proceeds must have been assessable to income tax. On the evidence I think they were entitled to come to that conclusion, and I propose to assume that they were right. I turn, therefore, to Mr. Heyworth Talbot's alternative submission. This was to the effect that even if in 1922 the royalty agreement became part of the company's stock-in-trade, it had become transmuted long before 1964 into a fixed asset. It was not suggested on behalf of the Crown that there is any reason in law why a tra ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sts and investments at or under cost, 287,967. That figure included the sum of ten pounds to which I referred earlier. On July 1, 1948, however, the Companies Act, 1948, came into force, and paragraph 4 of Schedule VIII of that Act required fixed assets to be distinguished from current assets in a company's balance sheet. This led to consultation between an accountant member of the company's board and its auditors, and as a result of this the item Oil interests and investments at or under cost was expanded in the balance sheet as at March 31, 1949, to read as follows : Quoted investments, 297,030 ; Unquoted investments, 1,078 ; Fixed Asset : Royalty interests at net amount standing in company's books at 1st July, 1 ..... X X X X Extracts X X X X X X X X Extracts X X X X
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