1980 (4) TMI 40

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....ublic limited company and the assessment year involved is 1967-68, for which the previous year ended on June 30, 1966. In completing the assessment the ITO brought to tax sum of Rs. 2,65,520 as capital gains. The company held some foreign securities whose cost was Rs. 3,84,147. The company sold them for a sum of Rs. 3,27,417. It appears that the funds were remitted to India according to the scheme....

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....of import entitlement, the realisation on the sale of import entitlement could not be brought to tax as capital gains under s. 45. On behalf of the department it was contended that Rathnam Nadar's case [1969] 71 ITR 433 related to a case of goodwill and the principle laid down therein is not applicable to the case of a sale of import entitlement and that, even otherwise, there would have been some....

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.... in Addl. CIT v. .K. S. Sheik Mohideen [1978] 115 ITR 243 that the principle of Rathnam Nadar's case [1969] 71 ITR 433 (Mad) is applicable to all cases where the cost of acquisition in terms of money is nil and that, therefore, even in the case of import entitlement the sale proceeds could not be brought to capital gains. This decision is, therefore, conclusive on the question whether the import e....