AI Drafter 
TaxTMI 
TaxTMI 
TaxTMI 
1957 (1) TMI 53
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....d by the provisions of section 10(1) or section 24(1) proviso read with section 14(2)(c) or by the provisions of section 42 ? (2)Whether on the facts of the case a loss of Rs. 22,981 is allowable in computing the income of the assessee chargeable to the excess profits tax ?" 2. The case arises out of the assessment of the respondent firm, Messrs. Chuni Lal Monga Ram for the year 1946-47 to income-tax, and to excess profits tax for the period ending 6th February, 1946. The assessee firm carries on a speculation business at Delhi. Forward transactions are entered in various bullion markets, and on certain transactions entered into with firms at Bhatinda in the then State of Patiala losses of Rs. 6,366 and Rs. 16,615 were incurred.....
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....l. At the time when the application was heard it was agreed that the first matter arose, but the assessee objected to the framing of the second question. His objections on this point were, however, overruled. 3. It appears that the point raised in the first question is virtually settled law, since it is admitted that the only High Court in India which now takes the view that losses incurred by an assessee in British India on business transacted in an Indian State could not be taken into account in assessing his income from business by virtue of the provisions of the Income-tax Act relied on by the Commissioner, is the Allahabad High Court, and the other courts, including our own, have taken the contrary view. The latest decision of this ....
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....ndia where such business is carried on by or on behalf of a person who is resident but not ordinarily resident in British India unless the business is controlled in India : Provided further that where the profits of a part only of a business carried on by a person who is not resident in British India or not ordinarily so resident accrue or arise in British India or are deemed under the Indian Income-tax Act, 1922, so to accrue or arise, then, except where the business being the business of a person who is resident but not ordinarily resident in British India is controlled in India, this Act shall apply only to such part of the business, and such part shall for all the purposes of this Act be deemed to be a separate business : ....
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....nder the provisions of the aforesaid Act to be received in or are brought into the taxable territories in any chargeable accounting period, or are assessable under section 42 of that Act." 7. It is, however, clear that neither the old nor the new proviso mentions losses, and it would appear to me that the only real difference is that whereas under the Excess Profits Tax Act profits made on business in an Indian State were on no account to be taken into consideration in the assessment of excess profits tax in British India, whether such profits were allowed to remain where they were or were brought by the assessee into British India, the proviso in the Business Profits Tax Act has been amended so as to incorporate the principle of section....
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....n a matter of this kind of section 14(2)(c). 8. It would seem that in spite of the slightly different language of the Excess Profits Tax Act from that of the Income-tax Act, no distinction has ever been drawn in this matter between the principles governing assessment to income-tax and the principles governing assessment to excess profits tax, and in fact it would appear to have been the universal practice that decisions of the Income-tax authorities and High Courts have been followed by consequential orders relating to the same assessee's taxable income for the purpose of the Excess Profits Tax Act, and the learned counsel for the Commissioner has not been able to cite any decision in which different principles have been applied on t....