Court-permitted sale of attached business machinery remains taxable when it is incidental to the business and its closure.

A court-permitted sale of machinery attached in execution against a business debt was treated as a sale in the course of business and remained taxable because the asset belonged to the assessee's business and the transaction was connected with that business. The attachment, the need for prior court permission, and the assessee's limited freedom in the mode of sale did not change its legal character. Under the relevant statutory definitions, a sale covers such transactions, and business includes acts incidental or ancillary to the business or its closure. The sale was therefore not a distress sale or casual sale outside the charging provision.

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Issues: Whether the sale of attached machinery, effected with the court's permission and for discharging business debt, was a sale in the course of business and therefore taxable, or whether it was a distress sale or casual sale outside the charging provision.

Analysis: The machinery sold belonged to the assessee's business, and the sale arose out of execution proceedings against that business asset. The fact that the property was under attachment, that prior permission of the court was necessary, and that the assessee had little choice in the mode of sale did not alter the legal character of the transaction. On the relevant statutory definition, a sale includes such a transaction, and the expanded definition of business also covers transactions incidental or ancillary to the business and its closure.

Conclusion: The sale was rightly treated as a sale in the course of business and was taxable. It was not a distress sale or a casual sale.

Final Conclusion: The reference failed and the order of the Tribunal declining interference was sustained.

Ratio Decidendi: A compulsory or court-permitted sale of business assets remains taxable where it is connected with the business and falls within the statutory meaning of sale and business, including transactions incidental or ancillary to the business or its closure.

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