Adventure in the nature of trade: profit from acquiring and realising a decree treated as business income and taxable.

Where a money-lender acquired a money decree with the dominant intention at acquisition to put it into execution and realise funds, the transaction bears the character of an adventure in the nature of trade; the purchaser's motive and surrounding circumstances determine this classification, and a single isolated transaction may qualify if linked to the lender's business. Applying that principle, the Tribunal's inference that the profit of Rs. 68,880 arose from such a trading venture is upheld. Consequently, the profit is not a casual or capital accretion and is assessable to tax; appeal dismissed against the assessee.

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Issues: (i) Whether the Tribunal's inference that the profit of Rs. 68,880 is a profit from a venture in the nature of trade or from speculation not wholly outside the scope of money lending is correct in law; (ii) Whether the sum of Rs. 68,880 is not assessable to tax.

Issue (i): Whether the profit of Rs. 68,880 is from an adventure in the nature of trade or speculation not wholly outside the scope of money lending.

Analysis: The facts show acquisition of a money decree by a money-lending concern from a person who was a customer of the concern; the purchaser intended at the time of acquisition to put the decree into execution and realise the amount. Authorities establish that isolated transactions may nonetheless amount to an adventure in the nature of trade where the dominant intention at purchase is to resell or realise for profit; the purchaser's motive and the surrounding circumstances are relevant. The transaction here, while single, bore features allied to the assessee's money-lending business and reflected an intention to convert the decree into money at an early date.

Conclusion: The inference of the Tribunal is correct; the profit of Rs. 68,880 arises from a venture in the nature of trade and is not outside the scope of the assessee's business.

Issue (ii): Whether the sum of Rs. 68,880 is not assessable to tax.

Analysis: Having held that the profit arose from an adventure in the nature of trade connected to the assessee's money-lending activities, the profit does not qualify as a casual, non-recurring receipt or an accretion to capital immune from tax. The transaction's character brings the profit within taxable income.

Conclusion: The sum of Rs. 68,880 is assessable to tax.

Final Conclusion: Both questions referred are answered against the assessee; the Tribunal's conclusion that the profit is taxable is upheld and the assessee must pay costs.

Ratio Decidendi: Where a money-lender acquires a money decree with the intention at acquisition to put it into execution and realise the amount, the resulting profit from realisation constitutes an adventure in the nature of trade and is taxable.

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