9911796707
TMI Blog1977 (10) TMI 14X X X X Extracts X X X X X X X X Extracts X X X X ..... to s. 10(2)(vii) of the Indian I.T. Act, 1922 ? (2) Whether there was evidence before the Tribunal for its finding that the machinery in question was not used for the purpose of his business in the year of sale, that is, 1959 ?" The Tribunal declined to refer the second question but referred the first question under s. 66 of the Indian I.T. Act, 1922. However, by a supplemental statement of case dated 19th July, 1977, the second question also has now been referred to this court. Both the questions will, therefore, have to be answered. These questions arise on the following facts : Admittedly, in the calendar year 1959, the assessee sold certain machinery and the total surplus amount recovered by the sale of the said machinery was Rs. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... was not necessary to remand the matter to the AAC for a fresh finding on the question whether the machinery was discarded in the year 1958, and the Tribunal took the view that it must proceed on the footing that because the machinery was discarded prior to the year 1959, it could not be said to have been used for the purpose of carrying on the business in the year 1959, that is, the year of sale and the amount recovered by the sale of machinery could not be brought to tax under the second proviso to s. 10(2)(vii). As already stated, two questions have been referred to this court. So far as the first part of the first question is concerned, namely, whether depreciation claimed in the earlier years is included in the words "loss, expenditur ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , whether the said amount of Rs. 29,364 could be brought to tax under the second proviso to s. 10(2)(vii) of the Indian I.T. Act, 1922, is closely connected with the second question which has now been referred by the supplementary statement. It is contended on behalf of the revenue that there was no evidence whatsoever before the Tribunal for its finding that the machinery in question was not used for the purpose of the business of the assessee in the calendar year 1959 which was the year of sale. The Tribunal has in the statement of the case referred to a letter addressed to the ITO on 6th October, 1960, by the chartered accountants of the assessee in which it was clearly stated thus : "In the return of income submitted by our client the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pointed out, there was evidence before the Tribunal which the Tribunal was entitled to accept and rely upon in order to arrive at the finding with regard to the point of time when the machinery was discarded by the assessee. Thus, we find that there was evidence before the Tribunal for finding that the machinery in question was not used for the purpose of the business of the assessee in the year 1959. The natural corollary of that finding is that the provisions of the second proviso to s. 10(2)(vii) could not be attracted. In this view of the matter, both parts of the first question are answered in the negative, in favour of the assessee and the second question is answered in the affirmative, also in favour of the assessee. The revenue t ..... X X X X Extracts X X X X X X X X Extracts X X X X
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