https://www.taxtmi.com/caselaws?id=276353 The second proviso to section 10(2)(vii) of the Indian Income-tax Act, 1922 applies only where machinery is transferred by a sale in the commercial sense, producing real profit to a distinct trader. On the facts, the transfer of machinery to a newly formed company was treated as a mere conversion or readjustment of the same business by substantially the same persons, despite the separate legal identity of the firm and the company. As there was no genuine commercial sale yielding taxable profit, the balancing charge provision could not be invoked. The excess was therefore not assessable to tax under the proviso. en-us Wed, 22 Sep 1965 00:00:00 +0530 Thu, 08 Nov 2018 10:39:18 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=276353 The second proviso to section 10(2)(vii) of the Indian Income-tax Act, 1922 applies only where machinery is transferred by a sale in the commercial sense, producing real profit to a distinct trader. On the facts, the transfer of machinery to a newly formed company was treated as a mere conversion or readjustment of the same business by substantially the same persons, despite the separate legal identity of the firm and the company. As there was no genuine commercial sale yielding taxable profit, the balancing charge provision could not be invoked. The excess was therefore not assessable to tax under the proviso. Case-Laws Income Tax Wed, 22 Sep 1965 00:00:00 +0530 https://www.taxtmi.com/caselaws?id=276353