TaxTMI 
TaxTMI 
1939 (1) TMI 14
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....the deed of partition in order to ascertain the original cost of the machinery and building to the assessee by reason of the fact that such cost had been stated in the partition deed as Rs. 29,22,050 and the share of the assessee in the assets of the Hindu undivided family had been made up on the footing of such valuation ? 2. As to question 1, the circumstances are that the assessee (who inter alia, is a money-lender) had a branch outside British India. He was communicated with by post by a person whom we will call A. A requested a loan. The loan was granted. It took the form of a negotiable hundi sent by post and capable of being converted into cash in Calcutta where A resided. It is suggested that when that hundi was sent from without....
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....ough B handed the letter to A at the time of posting. See Henthorn v. Fraser (1892) 2 Ch.D. 27 at pp. 32, 33. In the last case (and in Dunlop v. Higgins) the matter was also put on the usage of trade. See loc. cit. p. 35. Even on the view taken in the last cited case by Kay, L.J., who sought to restrict the effect of Dunlop v. Higgins, this would be a case where the hundi (i.e., the "profits or gains") was handed to the Post Office outside British India as an agent of A to carry to A. 5. The second question arises out of these circumstances. A joint Hindu family possessed items of property X and Y. We are concerned with X. The members we will call A and B. A and B decide to separate. They divided Y into two equal parts. X (which is a gin....
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....t. 8. We proceed, however, in this matter on the assumption that the 28 lakhs and odd bid was a fair and proper bid representing the value A put upon X and was willing to acquire X for. 9. At first sight that appears to be the original cost of X to A. But it will be seen that A is bidding for a property that, as to half, was already his. Had his bed been Rs. 20 the result would be that he gets X and Rs. 10 (X what fall to his share and Rs. 10 half the sum bid). If his bid were Rs. 30 the result would be X plus Rs. 15. Thus an increase of Rs. 10 in the results in a cost of Rs. 5 to him. 10. Thus under no view could the cost to him on the facts here present, be more than Rs. 23,11,510 plus 1/2 (28,22,050-23,11,510). That fact alone m....
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.... and Y as before and Z. Z cost Rs. 1,000 but A (thinking that Z is valuable, e.g., believing it is diamondiferous) bids Rs. 21,000 for Z. B bids Rs. 10,000 for X and Rs. 10,000 for Y. Result B gets X and Y plus Rs. 10,000. A gets Z plus Rs. 10,500 plus Rs. 10,000. Net result (for the Rs. 21,000 and 10,000 and Rs. 10,000 bids do not result in the parting with any money) by gets X and Y and A gets Z. What has Z cost A ? Rs. 1,000 or Rs. 21,000 or some other figure ? What he has in fact given at one time or another (looking at his as a shareholder of half in a joint Hindu family) is 1/2 (10,000) for X, 1/2 (10,000) for Y, and 1/2 (1,000) for Z. In other words he has given for Z at one time or another money or property worth Rs. 10,500/-. 14....