Adventure in the nature of trade: isolated resale of plant treated as taxable trading activity on the proved facts.

Whether profit from the purchase and resale of a spinning plant was taxable turned on whether the transaction was an adventure in the nature of trade. The statutory phrase is a question of law, but applying it to proved facts is ordinarily an inference of fact. A tribunal's contrary conclusion may be set aside where it rests on a misunderstanding of the statutory language, no evidence, or a conclusion no reasonable tribunal could reach. On the facts, the buyers intended a quick resale at profit, organised the disposal, incurred trading-like expenses, and sold the plant in lots for gain; the isolated nature of the venture did not prevent it from being trading. The assessments were therefore confirmed.

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Issues: Whether the profit from the purchase and resale of a spinning plant constituted an adventure in the nature of trade and was assessable to income tax under Case I of Schedule D.

Analysis: The statutory phrase "trade, manufacture, adventure or concern in the nature of trade" is a question of law, but whether the proved facts answer that description is ordinarily an inference of fact. A finding of the Commissioners can be disturbed where it is based on a misunderstanding of the statutory language, on no evidence, or on a conclusion that no reasonable tribunal properly directed could reach. On the facts found, the respondents bought the plant with the intention of quick resale at a profit, organised its sale, incurred trading-like expenses, and in fact sold it in several lots for a substantial gain. The circumstance that the venture was isolated did not prevent it from being a trading adventure.

Conclusion: The transaction was an adventure in the nature of trade and the assessments were rightly confirmed.

Final Conclusion: The appeal succeeded and the Revenue's assessments stood reinstated, the court holding that the only reasonable conclusion on the facts was that the operations were taxable trading adventures.

Ratio Decidendi: Where the proved facts admit of only one reasonable conclusion, a tribunal's contrary finding that a transaction is not an adventure in the nature of trade is erroneous in law and may be set aside even if the issue is framed as one of fact.

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