COMMISSIONER OF INCOME-TAX, BOMBAY vs RAMNARAIN KAPUR & Co. (PVT.) — 1971 PTD 125

Citation: 1971 PTD 125

Court: Bombay High Court

Year: 1970

Decision Date: 1970-12-31

Parties: COMMISSIONER OF INCOME-TAX, BOMBAY vs RAMNARAIN KAPUR & Co. (PVT.) JUDGMENT

Headnotes

Case cited as 1971 PTD 125

Judgment Text

Court Name: Bombay High Court Judge(s): V. S. Desai, S. P. Kotwal Title:COMMISSIONER OF INCOME-TAX, BOMBAY vs RAMNARAIN KAPUR & Co. (PVT.) JUDGMENT Reported As: 1971 PTD 125 Result: Question answered in the affirmative Judgment JUDGMENT KOTVAL, C. J.-The following question has been referred under section 66(1) of the Indian Income- tax Act for our decision : "Whether the inference of the Tribunal that the profits of Rs. 52,075 and Rs. 29,035 are only capital gains and not trading profit of the respective assessment years 1953-54 and 1954-55 is in accordance with law?" The assessee is Messrs Ramnarain Kapur & Co. (Private) Ltd. In which at the material time the members of the family of Ramnarain Kapur held the controlling shares as indicated below: Ramnarain Kapur 3,700 Ramnath Kapur (son) 400 K. S. Srinivasa 400 Miss Lakshmi Kapur and Master Chandra Kapur by their father and guardian R. N. Kapur400 Air Lines Hotel Ltd. 100 5,000 The company was by its memorandum of association empower--ed to carry on in India and elsewhere the business of "agency in all its branches and to act as managing agents for other companies in India or in any other country or place" (clause 1), to carry on and transact every kind of agency business (clause 2) and "to act as managers or managing agents of any corporation whether limited or unlimited"(clause 3). The company was also authorised by clause 6 of its memorandum of association "to invest and deal with the money of the company not…

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