COMMISSIONER OF INCOME-TAX, KERALA vs MORNING STAR BUS SERVICE — 1990 PTD 998

Citation: 1990 PTD 998

Court: Kerala High Court

Year: 1963

Decision Date: 1963-02-18

Parties: COMMISSIONER OF INCOME-TAX, KERALA vs MORNING STAR BUS SERVICE

Headnotes

Case cited as 1990 PTD 998

Judgment Text

Court Name: Kerala High Court Judge(s): M. S. Memon, P. Govindan Nair Title: COMMISSIONER OF INCOME-TAX, KERALA vs MORNING STAR BUS SERVICE Case No.: Case No.2 of 1962 Date of Judgment:1963-02-18 Reported As: 1990 PTD 998 Result: Reference answered in the negative JUDGMENT JUDGMENT M.S. MENON, C.J.---This is a reference by the Income-tax Appellate Tribunal, Madras Bench, under section 66(l) of the Indian Income-tax Act, 1922. The question referred is:-- "Whether the sum of Rs.45,698 is assessable to tax under the provisions of the second proviso to sections 10(2)(vii) of the Income-tax Act?" The assessm ent year with which we arc concerned is 1956-57. The assessee, an association of persons consisting of five members, was carrying on a bus transport business in the accounting period relevant to the assessm ent year. On June 1st, 1955, the members of the association formed a private limited company and transferred to that company the business and assets of the association. There were no share- holders other than the members of the association, and no assets other than those transferred by the association. The written down value of seven buses transferred to the company was Rs.24,302. Their value, however, was entered in the books of the company as Rs.70,000. The question for consideration is whether the difference between the two figures, namely, Rs.45,698 is assessable to tax under the second proviso to section 10(2)(vii) of the Indian Income-tax Act, 1922. Subsection (2)…

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