For these years and for the assessment year 1943 44 the companypany made its Return on that basis.
34,954 during the year ended 30th June, 1946.
It then appealed to the Income tax Appellate Tribunal, Bombay, where the same companytentions were raised but were, repelled.
The assessee companypany then made an application under s. 66 2 of the Indian Income tax Act for requiring the Appellate Tribunal to state the case and refer it to the High Court but this application was dismissed, and then the companypany obtained special leave to appeal to this Court.
Since that Return was submitted the Central Board of Revenue has decided that the Company is an Invest ment Holding Company and accordingly an amended Return of Total Income under Section 22 1 of the Indian Income tax Act is submitted herewith on which the assessment for 1943 44 may be based, as on this particular question the companypany obviously cannot have one status for Excess Profits Tax and another for Income tax.
The Income tax Officer rejected this plea and held the investments as the stock in trade of its business therein which it carried on during the previous year also .
The assessment years under review.
Appeal by special leave from the judgment and order dated January 15, 1952, of the Bombay High Court in Income Tax Application No.
2,000/ was the value of shares of the Loyal Mills Ltd., taken over from the retiring staff.
This was more than it had said in its appellate order.
J. Kolah, J. B. Dadachanji, S. N. Andley and Rameshwar Nath, for the appellant.
K. Daphtary, Solicitor General of India, G. N. Joshi and R. H. Dhebar, for the respondent.
1, 2, 15 and 16 of that clause.
During the period of 9 years from 1st July 1930 to 30th July 1939 numberpurchases were made with the exception of a few shares of Loyal Mills Ltd., taken over from the staff of E. D. Sassoon Co. Ltd., who retired from service.
54 of 1951.
The companypany took an appeal to the Appellate Assistant Commissioner which was dismissed and the order of the Income tax Officer upheld.
56,700/ .
This gives the history of the acquisition and disposal of shares and also how the various transactions were entered into and why.
45,000 in the Loyal Mills Ltd., sold to the members of the staff and shares of the value of Rs.
In the year ended 30th June 1940 reconstruction scheme of the Appollo Mills Ltd., took place under which debentures held by the Petitioner Company in the Appollo Mills Ltd., were redeemed and the proceeds were reinvested in the new issue of shares made by the Appollo Mills Ltd. Out of the purchases of the value of Rs.
CIVIL APPELLATE JURISDICTION Civil Appeal No.
After this there were numberpurchases at all to this date excepting purchases of the value of Rs.
1,33,930.
153 of 1954.
tax Officer in the 1940 41 assessment that the companypany was to be assessed as a dealer in investments.
1,86,47,789/ major portion of which was companyprised of shares in the Sassoon Group of Mills.
In the year ended 30th June 1943 the Petitioner Company took over from the David Mills Co. Ltd., shares of The Associated Building Co., of the value of Rs.
2,794 made by the Petitioner Company during the year ended 30th June 1941 Rs.
In the year 1930, the Petitioner Company purchased shares of Rs.
The Judgment of the Court was delivered by KAPUR J. This is an appeal by the assessee by special leave and the question for decision is whether questions of law, if any, arise out of the order of the Appellate Tribunal.
III of the memorandum of association and more particularly in sub cls.
It said The Tribunal did number decide this point merely because the companypanys memorandum of association gave power to the companypany to deal in investments and properties, but it was actually found that the companypany had dealt in investments and properties throughout and had also all along in the past asserted that it was a dealer in investments and properties.
Prior to 1940 the assessee companypany made a claim every year for being treated as a dealer in investments and properties but this companytention was companysistently repelled and upto the assessment year 1939 40 the assessee companypany was assessed on the basis of being an investor but it appears that for the assessment year 1940 41 and the two following years 1941 42 and 1942 43 the Department accepting the plea of the assessee companypany treated it as a dealer in shares, securities and immovable properties and assessed it on that basis.
May 22.
are 1943 44 to 1948 49, excepting the year 1947 48.
10 1/2 lacs.
The facts giving rise to the appeal are that the petitioner companypany was incorporated on July 29,1924, as an investment companypany, the objects of which are set out in el.
During the year ended 30th June 1929 the Petitioner Company promoted two companypanies known as Loyal Mills Ltd. and Hamilton Studios Ltd. and took over all their shares of the value of Rs.
The companypany then applied to the Appellate Tribunal under s. 66 1 of the Indian Income tax Act for a reference of the following questions for the opinion of the High Court Whether on the facts and in the circumstances of the case the assessee companypany can rightly be treated as a dealer in investments and properties and Whether the profits and losses arising from the sale of shares, securities and immoveable properties of the assessee companypany can be taxed as business profits.
It was also companytended that it never carried on any business in the purchase or sale of shares, securities or properties and therefore prayed that in view of the order of the Central Board of Revenue made on its application under s. 26 1 of the Excess Profits Tax Act it should be assessed for income tax purpose as an investor and number as a dealer.
This prayer was rejected because in the opinion of the Tribunal numberquestion of law arose out of its order.
1,29,333 included shares of the value of Rs.
Along with the Return it filed a letter dated March 6, 1944, in which inter alia it stated The Return of Total Income which was submitted with the Companys letter of 25th May 1943 was prepared in companyformity with the ruling of the Income.
But after the Return had been filed for the year 1943 44 the assessee companypany withdrew its Return and filed a revised Return on March 7, 1944, companytending that it was number a dealer but merely an investor.
The sales are companytained in para 3 b which may be quoted In relation to the purchases made by the Petitioner Company as stated above numberappreciable sales of shares were made during the period 29th July 1924 to 30th June 1942, the sales made in the year ended 30th June 1929 of the value of Rs.
