1984 (2) TMI 16

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..... t years 1965-66 and 1966-67 is as follows : " Whether, on the facts and in the circumstances of the case, the Tribunal was right in holding that the assessee was entitled to the benefit of section 47(iii) of the Income-tax Act, 1961 ? " Although the question raised is a very substantial one, we feel that it is not really necessary to answer this question in this particular case because of some o .....

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..... sment year 1966-67. He held that the " capital gains " were Rs. 1,94,072 for the first year and Rs. 4,13,566 for the second year. It may be mentioned that the profit had been shown by the assessee company on the basis that it was a dealer in shares. The Income-tax Officer had in fact followed an earlier decision of the Tribunal whereby the assessee was treated as not being a dealer in shares. The .....

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..... ofits were assessable under the head "Capital gains " and not under the head " Income from business ". However, following the judgment of the Kerala High Court in the case of K. P. Varghese v. ITO [1970] 77 ITR 719, it was held that section 52 could not be invoked and, hence, the additions made by the Income-tax Officer were deleted. On appeal to the Income-tax Appellate Tribunal, it was held tha .....

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..... rought to our notice that the Full Bench judgment of the Kerala High Court has been reversed by the Supreme Court as per its judgment in K. P. Varghese v. ITO[1981] 131 ITR 597. This means that the view of the Appellate Assistant Commissioner to the effect that section 52(2) of the Income-tax Act, 1961, cannot be invoked in this case has to be upheld. So, in any case, the question referred to us w .....

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..... not treated as a dealer in shares, then section 52(2) is not attracted because of the Supreme Court's judgment in K. P. Varghese's case [1981] 131 ITR 597, and, in any event, even if section 52(2) applied, section 47(iii) would apply and no capital gains would be involved. Having examined various aspects of the case as they now exist, we hold that the question referred to us has become redundant .....

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