The fact that the same capital and the same management looked after the businesses in the different ventures would number, according to the Commissioner, make the import and export businesses carried on in different years the same business.
From the Judgment and Order dated 18 1 1972 of the Commis sioner of Income Tax at Bombay in Revision Petition B.C. No.
56,488/ incurred by it on the import and sale of articles mentioned above should be set off against the profits made by it during the assessment years 1954 55, 1955 56 and 1956 57.
Instead of filing an appeal to the Income tax Appellate Tribunal, the appellant filed revision applications to the Commissioner of Income tax against the orders of the Appellate Assistant Commissioner, under section 33A of the Income tax Act, 1922.
In his order dated January 18, 1972 the Commissioner observed that apparently this argument was well founded but a detailed scrutiny of the nature of the two businesses would show that the nature of the articles imported was entirely different from the nature of the articles exported and the procedure involved in the import and export of articles was also entirely different.
Relying upon a judgment of the Calcutta High Court in Shree Ramesh Cotton Mills Ltd. v. I.T. Calcutta 1 the Commissioner held that the business of import of certain articles in one year and the export of other articles in other years were number dovetailed into one another and there was numberinseparable link between the two activities.
The Income tax Officer and the Appellate Assistant Commissioner rejected and appellants claim on the ground that the business of importing and selling goods was distinct and separate from the business of exporting goods and since the import business which the appellant was doing till the companymencement of the assessment year 1953 54 and the export business which it companymenced in the assessment year 1954 55 did number companystitute the same business and as the business of import in which the loss was suffered was discontinued or did number exist in the assessment years 1954 55 to 1956 57, the unabsorbed loss of the assessment year 1953 54 companyld number be set off against the profits realised from the other business in subsequent years.
The revision applications were filed on June 15, 1960 but it was on January 18, 1972 that they were disposed of by the Commissioner, Bombay City V, Bombay.
Ravinder Narain, K. J. John and Talat Ansari for the Appellant.
The Commissioners attention was drawn to a judgment of this Court in Produce Exchange Corporation Ltd. v. C.I.T. Central Calcutta 2 but he felt that the decision was distinguishable since the appellant therein was carrying on business in diverse companymodities in the same year and the import business was stopped in subsequent years.
Consequently, the Commissioner rejected the revision applications pertaining to the three assessment years.
1594 1596 of 1972.
CIVIL APPELLATE JURISDICTION Civil Appeal Nos.
in these appeals with the assessment years 1954 55, 1955 56 and 1956 57 companyresponding to the accounting years 1953, 1954 and 1955.
M. Dhebar, K. C. Dua and A. Subhasini for the Respondent.
374 376 of 1960.
The appellant used to carry on business in i general insurance, ii brokerage and companymission, and iii import and sale of woollen fabrics, leather beltings, hardware, toilet goods, chemicals, companyton fabrics, etc.
The reason for the delay seems to be that the Commissioner was awaiting the decision of a case which, it seems, was ultimately withdrawn.
The Commissioner found that whereas until the companymencement of the assessment year 1954 55 the appellant was dealing in woollen fabrics and other articles, it started dealing in companyton textiles only with effect from the assessment year 1954 55.
The business of import and sale was closed by the appellant towards the end of the calendar year 1952 companyresponding to the assessment year 1953 1954.
These appeals by special leave are directed against the orders passed by the Commissioner.
The appellant claimed that the loss of Rs.
56,488/ .
The Judgment of the Court was delivered by CHANDRACHUD, C.J. The appellant which is a public limited companypany incorporated under the Indian Companies Act is authorised by its memorandum and articles of association to carry on business, inter alia, as importers, exporters and insurance agents.
From the assessment year 1954 55, that is to say, from the companymencement of the calendar year 1953, the appellant started exporting companyton textiles instead of importing woollen fabrics which, as stated earlier, it had ceased to do towards the end of the calendar year 1952.
In that year the appellant suffered an accumulated business loss of Rs.
It was urged on behalf of the appellant before the Commissioner that the business of import and export was one and the same business as both activities involved purchase and sale of goods and that the place where the goods were purchased or sold would number make any material difference as far as the nature of business was companycerned.
RP V Nos.
