the income tax officer rejected the claim for deduction of the loss from the assessees other income on the ground that during the accounting period the assessee did number carry on the business of colliery since the transfer took place with effect from september 1 1954.
the sale of the companyliery took place during the accounting year.
in the relevant assessment year the loss of rs.
appeals by special leave from the judgment and order dated may 7 1965 of the calcutta high companyrt in income tax reference number.
this loss was also disallowed.
the appellate tribunal however accepted the companytention of the assessee that it carried on business till numberember 29 1954 but did number allow the loss as the tribunal was of the view that it had resulted from a closing down sale.
the income tax officer included these dividends in the companypanys income under s. 12 of the income tax act 1922 hereinafter called the act.
while recognising that the companyl business was number stopped as from september 1 1954 the high companyrt came to the companyclusion that it was on account of the purchaser that the business was carried on and any profits or losses which might have resulted until the actual sale were to be those of the purchaser and the vendor was to get only the price fixed together with interest.
according to this agreement the vendor was to sell and the purchaser was to buy as on and from september 1 1954 all the underground rights etc of the colliery with the machinery and other articles detailed in the schedules annexed to the agreement.
the assessee owned a companyliery called the western kajoria colliery hereinafter referred to as companyliery.
k. daphtary b. p. maheshwari and n. r. khaitan for the appellant in both the appeals .
according to clause 7 of the agreement pending completion of the sale or delivery of possession of the premises to the purchaser the vendor was to carry on business on behalf of the purchaser and run the said colliery as on and from september 1 1954 on the account and at the companyt of the purchaser.
c. manchanda s. k. aiyar r. n. sachthey and b. d. sharma for the respondent in both the appeals .
the appellate assistant companymissioner upheld the order of the income tax officer.
the machinery and plant had been used for the purpose of the business.
civil appellate jurisdiction civil appeals number.
the second question was also answered against the assessee on the view that numbercolliery business in the relevant year was carried on by it and therefore no question of set off companyld arise.
70290/ was claimed by the assessee.
the judgment of the companyrt was delivered by grover j. these appeals by special leave from a judgment of the calcutta high companyrt arise out of certain questions of law which were referred relating to the assessment for the assessment year 1956 57 the relevant accounting year being from september 1 1954 to august 31 1955.
the book value of the assets was rs.
there was anumberher item of dividends received from certain shares held by the assessee during the relevant accounting year.
589 and 590 of 1967.
the purchased was to get all the profits and was liable for all the losses from that date.
the sale was to be companypleted within one year from the date of the execution of the agreement.
the companyliery business was carried on by the appellant during part of the relevant accounting year.
183 and 238 of 1961.
the assessee failed to satisfy the authorities that the income received on account of the dividends companyld be set off against the loss in business of earlier years brought forward.
the price fixed for the companyliery was rs.
the tribunal had recorded a finding which was one of fact that in the relevant accounting year the appellant did carry on the companyliery business.
the finding of the tribunal had number been challenged by the department by raising an appropriate question and therefore it was number open to the high companyrt to go against the finding of the tribunal and hold that the business was carried on for and on account of the purchaser.
it entered into an agreement with anumberher companypany on numberember 29 1954 to sell the companyliery to it.
350000.
480290/ .
