1960 (4) TMI 66

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....e-Ganj, Agra. They had also deposits with the Hindu undivided family, Shiamlal Chimanlal of Agra. In their assessments for 1945-46 as "individuals" each of the applicants was assessed on income under three heads: (1) property, (2) share in the abovementioned registered firm, and (3) interest received from the abovementioned joint family. The figures are as follows: Head Assessee Kapoorchand. Assessee Chhail Behari Lal. 1. Property 3,823 5,222 2. Share from registered firm 9,578 9,578 3. Other sources (Interest from the Hindu undivided family.) 4,598 5,634   17,799 20,434     Each of the applicants had withdrawn from the firm Rs. 2,50,000 to buy shares in the Bijli Cotton M....

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....and gains under any of the other heads as provided under section 24(1), and thus arrive at the balance as the true taxable income of the assessee. 3. We, therefore, refer the following question of law for determination by the High Court: "Whether the assessee in each case is entitled to a deduction of the sum of Rs. 6,688 being interest paid during the relevant previous year on money borrowed to buy shares in the Bijli Cotton Mills Ltd., which shares yielded no income, from his other income, profits and gains, in order to arrive at his correct taxable income?" 4. The draft statement of the case was placed on the table. The Commissioner makes no suggestions. The assessee suggests the correction of a slip, which is made. The statemen....

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....f the Income-tax Act when computing the income from dividends on shares of the Bijli Cotton Mills Ltd. and since no actual dividends were received it should be held that each of them suffered a loss to the extent of Rs. 6,688 and that loss should be set off under section 24(I) of the Income-tax Act against their income from the other heads which has been mentioned above. The Income-tax Appellate Tribunal refused to allow this set-off and consequently on the request of the assessees the question mentioned above has been referred for our opinion. The Point that has been raised in this question came up for consideration before a Bench of the Bombay High Court in ormerods (India) Private Ltd. v. Commissioner of Income-tax [1959] 36 I.T.R. 32....