Same-business test for loss set-off turns on common management, funds, accounts and operational unity.

Two activities will be treated as the same business for carried-forward loss set-off where objective indicators show unity of trade. Common management, a single trading and profit and loss account, common organisation and administration, use of a common fund, and operation from the same place of business supported a finding of inter-connection, inter-lacing, inter-dependence and unity. On those facts, the share-dealing activity was not separate from the assessee's sugar manufacturing and distillery business, so the loss could be set off under the loss set-off provision considered.

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Issues: Whether the company's share-dealing activity and its sugar manufacturing and distillery business constituted the same business for the purpose of set-off of carried-forward loss under section 24(2) of the Income-tax Act, 1922.

Analysis: The Tribunal's supplementary findings showed a single trading and profit and loss account, common organisation and administration for both activities, use of a common fund, and conduct of both businesses from the same place of business. These facts satisfied the objective tests for determining whether two activities formed one business, namely inter-connection, inter-lacing, inter-dependence and unity, as reflected in common management, common business organisation, common administration, common fund and common place of business. On those findings, the share transactions were not separate from the assessee's other business activities.

Conclusion: The two activities constituted the same business, and the assessee was entitled to set off the loss.

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