1969 (12) TMI 5

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....ct of his sources of income arising outside the " taxable territories ". This question under section 66(1) of the Act was answered in favour of the assessee by the High Court of Madhya Pradesh. Aggrieved by that decision, the Commissioner of Income-tax, Madhya Pradesh, has brought this appeal. The assessee (the respondent) is a Hindu undivided family with its head-office at Indore and branches at several places. It derives income from property, business in cotton and oil seeds, speculation, dividends, managing agency commission, etc. Prior to the assessment year 1950-51, the assessee was assessed under the Indian Income-tax Act, 1922, in the status of a non-resident Hindu undivided family. The income which accrued to or was received by t....

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....t decision was affirmed by the Appellate Assistant Commissioner, but the Income-tax Appellate Tribunal reversed the finding of the Income-tax Officer and the Appellate Assistant Commissioner and agreed with the stand taken by the assessee. Thereafter, a reference was made to the High Court of Madhya Pradesh under section 66(1) of the Act at the instance of the Commissioner of Income-tax, but the High Court agreed with the view taken by the Tribunal. Hence this appeal. The question for our consideration is whether the view taken by the High Court is correct ? In order to decide that question, it is necessary to find out the true scope of section 2(11)(i)(a) of the Act, which provision defines the term " previous year " thus : " 'previo....

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....If they had not been previously assessed then the assessee's case comes within the first part of section 2(11)(i)(a). In that event his return was in accordance with law. Therefore, we have first to see what is meant by " source of income " in section 2(11)(i)(a) of the Act and then proceed to consider whether those sources of income had " once been assessed ". It is necessary to note that section 2(11)(i)(a) does not refer to the income of the assessee generally but to his " separate sources of income, profits and gains ". Hence, it is possible for an assessee to have a different " previous year " for each " separate sources of income, profits and gains " as held by the Madras High Court in Commissioner of Income-tax v. Savumiamurthy. I....