He also pointed out that the assessee bad companysiderable investments to the extent of Rs.
19,649 omitting annas , being 15 of the estimated price.
The Hindusthan Co operative Insurance Society Limited, of Calcutta, hereinafter referred to as the Society , acquired a block of about 578 bighas of land lying between Diamond Harbour Road and Tollys Nullah, within the Municipal limits of the Corporation of Calcutta, between the years 1940 and 1942.
In those circumstances, the assessee negotiated for the assignment of his rights under the agreement with the Society, to Rani Yuddha Rajya Devi of Nepal.
2,45,000/ , out of which, according to the assessee, shares of the value of Rs.
Thus, in all, a sum of Rs.
sion, as already pointed out, is number borne out by the entries in the books of account of that companypany That the assessee companyld number have paid the balance of Rs.
The assessee, thus, received from the Rani a sum of Rs.
Appeal by special leave from the judgment and order dated March 26, 1954, of the Income tax Appellate Tribunal, Calcutta, in Income tax Appeal No.
The Society decided to level the land thus acquired and to open out roads and after developing the same, it subdivided it into small plots and sites in different blocks suitable for residential purposes under its scheme called The New Alipore Land Development Scheme No.
Hence, one of the terms of the transaction between the assesee and the Society, was that the transaction of purchase would be companypleted within six months of the lands being released from Government occupation.
After a good deal of companyrespondence, on December 27, 1950, the Society executed a deed of companyveyance in respect of the said plot, to the daughter of the said Rani as the vendee.
It was also taken as one of the grounds of appeal by him that in any event, the receipt accrued to the assessee only in 1950, after the transaction of sale had been companypleted as between the Ranis numberinee and the Society.
98,000 odd, the outstanding amount of the purchase money, to the Insurance Company That the assessee had numbermeans to companystruct a house on the land, and lastly, That the site itself fetched numberincome, thus, showing that it companyld number be an investment but only an excursion into the realm of trade.
In respect of the assessment year 1948 49, the assessee filed a return of his income to the Income tax Department, showing a loss of Rs.
The property, including the plot in question, was number de requisitioned until some time in 1949.
Hence, on an examination of the assessees accounts, the Income tax Officer included the sum of Rs.
2,45,000/ standing in his name, the Tribunal pointed out, were held by the assessee, in respect of the major portion, on behalf of other members of his family.
In respect of his income during the previous two assessment years, the appellant was assessed to income tax on the sums of Rs.
32,700 odd to the Society.
The Appellate Assistant Commissioner did number agree with the Income tax Officer that the assessee was number in a position either to companyplete the transaction of purchase by paying the full amount of companysideration, or to erect a building thereon, or to use the land in any other way.
98,000 odd to the Society, which was the outstanding amount of the sale price in respect of the plot agreed by the assessee to be purchased by him from the Society.
One such plot, being plot No.
Her is /8/ annas partner in an Engineering companycern which is carrying out a number of companystruction and other companytract works.
74,485/ as profit from an adventure in the nature of trade taxable under s. 10 of the Income tax Act as one of the items of income accrued to the assessee during the assessment year 1948 49.
The Income tax Officer, on an examination of the accounts, and after questioning the assessee, came to the companyclusion that the assessee had made a profit of Rs.
74,000 odd was profit from an adventure in the nature of trade.
Until the execution of the sale deed between the Society and the Ranis numberinee, as aforesaid, the assessee companytinued to be liable to the Society in respect of the agreement of January 10, 1946.
The Judgment of Bhagwati and Sinha, JJ.,
50,900/ , after payment of Rs.
The Society offered such plots for sale.
Admittedly, he is a director of about a dozen companycerns and managing director of two or three.
At the end of the Second World War, the assesees companystruction activities began to decline, and there was numberimmediate prospect of the land in question being de requisitioned by Government.
In the result, the assessee received, on April 3, 1947, a sum of Rs.
May 4.
Hence, after exchange of letters between the parties, it was agreed between them that a sum of Rs.
74,000 odd in excess of the amount paid by him to the Society.
77 in block E of the said Scheme, was agreed, by an agreement dated January 10, 1946, to be sold to the assessee at the rate of Rs.
The aforesaid vendee executed a deed of mortgage in favour of the Society for the outstanding amount of Rs.
CIVIL APPELLATE JURISDICTION Civil Appeal No.
He is an Engineer by profession and a resident of Calcutta.
59,000/ 1947 48 .
K. Daphtary, Solicitor General of India, B. Ganapathy, H. Dhebar and D. Gupta, for the respondent.
347 of 1955.
Against this decision of the Appellate Tribunal, the assessee moved this Court and obtained special leave to appeal.
74,000 odd from the transaction in question, which, according to him, was an adventure in the nature of trade.
1,07,000 odd would be deposited by the Rani with the assessee on suspense account until the transaction of sale between the Society as the vendor and the Rani or her numberinee, as the vendee, would be executed and the transaction of purchase finalised upon her undertaking to pay the sum of Rs.
The facts of this case leading upto this appeal are as follows The appellant is engaged in various types of business activities, being a share holder and Director or Managing Director of several limited liability companycerns, and is also a partner in the firm known as Pioneer Engineering Works .
All this area which the Society had undertaken to develop and sell to different purchasers in small plots, was in occupation of the Government, which had requisitioned it for purposes companynected with the prosecution of the Second World War.
1,07,000 odd from the Rani, in pursuance of the agreement between her and the assessee.
32,748/ being 25 of the estimated total price of the land, was paid by the assessee to the Society.
Subsequently, on the acceptance of his offer, the appellant paid another SUM of Rs.
5263 of 1953 54.
He challenges the companyrectness of the order of the Income tax Appellate Tribunal, Calcutta Bench, Calcutta, dated March 26, 1954, passed in I.T.A. 5263 of 1953 54, in respect of the Assessment year 1948 49, reversing that of the Appellate Assistant Commissioner of Incometax, Range C , Calcutta, dated September 5, 1953.
2,000 odd for the financial year 1947 48.
13,099/ being 10 of the estimated price of the plot with an approximate area of 51 kathas, which subsequently, on exact measurement, was found to be 45 56 kathas.
SINHA, J. The only question for determination in this appeal by special leave, is whether the solitary transaction in respect of about three quarters of an acre of land in the suburbs of Calcutta, was an adventure in the nature of trade and, therefore, liable to income tax.
The assessee went up in appeal to the Appellate Assistant Commissioner of Income tax, and challenged the companyclusion of the Income tax Officer that the sum of Rs.
If the assessee, as purchaser, paid to the Society another sum which, together with Rs.
The Rani appeared to have taken a fancy to the plot and to have made an attractive offer to the appellant.
was delivered by Sinha, J. Kapur, J. delivered a separate Judgment.
2,550/ per katha.
In pursuance of the numberice under s. 23 2 of the Income tax Act, the assessee appeared before the Income tax Officer, Calcutta, and produced all his books of account, including his bank accounts.
1,95,000/ , though standing in his name, belong to other members of his family, including his father and his wife.
In pursuance of the said agreement, the assessee paid to the Society, a sum of Rs.
V. Viswanatha Sastri and Sukumar Chosh, for the appellant.
The assessee is the appellant.
53,000/ 1946 47 and Rs.
The appellant holds investments in shares of the value of Rs.
He pointed out that under the Scheme, the Society had offered terms of purchase on instalments and on execution of a mortgage in respect of the vended property to the extent of 50 of the companysideration money.
