1959 (9) TMI 67

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....ess income falling under section 10 of the Act?" The assessee derived income in the relevant year from (i ) house property; (ii) moneylending and commission agency; and (iii) speculation in gold, silver and cotton. The Income-tax Officer refused to adjust the loss of ₹ 21,748 in the speculation business against the profits from other business. The assessee filed an appeal which was dismissed by the Appellate Assistant Commissioner. A second appeal was preferred before the Income-tax Appellate Tribunal, Delhi Bench, which allowed it, but has referred to this court the question of law set out above. The scheme of the Income-tax Act may here briefly be stated. Under section 6 the activities yielding income and profit have been div....

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....e taxable territories in ascertaining the net income from business, profession or vocation under the fourth head in section 6, notwithstanding the contrary provision implied in this proviso to section 24. See Commissioner of Income-tax v. C.P. Syndicate [1952] 22 ITR 493 and Commissioner of Income-tax v. Hira Mall Narain Dass [1953] 24 ITR 199. The question was recently considered by the Supreme Court in Commissioner of Income-tax v. Indo-Mercantile Bank Ltd [1959] 36 ITR 1 7 Though it arose in the context of the Travancore Income-tax Act, the decision applies equally to the Indian Income-tax Act, as the wordings are similar to the relevant provisions. The contention that the proviso to section 24 amounted to a substantive enactment govern....

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....pose of ascertaining the income from a particular head under section 10. The words "any loss sustained in speculative transactions which are in the nature of a business" further confirm this inference. It is obvious that the losses are in one of the businesses of the assessee for which special provision is being made. That special provision is that the losses shall not be adjusted towards the profits of any other business. Such a contingency cannot arise at all if the proviso were to operate only within the field of the main provision. It would in that case be more or less meaningless. We must therefore hold that the proviso affects expressly the method of ascertaining profits and losses of the various businesses. It, therefore, f....