Relief under Section 25(4) applies only to profits and gains of the succeeded business, not an assessee's total income.

Section 25(4) relief is confined to preventing double taxation of the profits and gains of a particular business, profession or vocation that was charged under the earlier Act; the phrase "income, profits and gains" must be read with the proviso and context to mean income under the business head contemplated by Section 10 rather than the assessee's total income from other sources. Consequently, succession to a business in the same capacity entitles relief only for that business's profits, not for distinct separate businesses or other heads of income.

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Issues: (i) Whether the relief under Section 25(4) of the Income-tax Act applies to the total income of the assessee whose business is succeeded to, or is confined to the profits and gains of the particular business, profession or vocation which was assessed under the earlier Act.

Analysis: Section 25(4) is framed to prevent double taxation where a business assessed under the earlier Act is succeeded and would otherwise be taxed again. The subsection's phrase "income, profits and gains" must be read in the context of the provision as a whole and the proviso, where the same phrase is expressly juxtaposed with "business, profession or vocation." The conditions for relief require (a) carrying on a business, profession or vocation, (b) that that business was charged to tax under the earlier Act, and (c) succession to that business in the same capacity by another person. The legislative scheme and the proviso show that the expression "income, profits and gains" in sub-section (4) refers to the profits and gains of the particular business or vocation contemplated by Section 10 and not to the assessee's total income from other sources. Prior authorities construing similar language have treated the relief as relating to the head of income governed by Section 10 rather than to income from property or other heads.

Conclusion: The relief under Section 25(4) is confined to the profits and gains of the particular business, profession or vocation which was assessed under the earlier Act; it does not extend to the assessee's total income from distinct and separate businesses.

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