1976 (9) TMI 42

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.... Income-tax Act, 1961, the following question of law has been referred for the opinion of this court : " Whether, on the facts and in the circumstances of the case, the Appellate Tribunal was right in law in holding that the profit of Rs. 67,125 which arose out of the transfer of the import licence by the assessee to a third party did not attract capital gains tax ? " The relevant facts are ....

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....ioner, the assessee took up various contentions and they were negatived by him. On further appeal before the Tribunal, it was contended that no capital gain was involved in the transfer of the licence as it did not cost anything in terms of money in its creation or acquisition and for this purpose reliance was placed on a decision of this court in Commissioner of Income-tax v. K. Rathnam Nadar [19....

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....ssee securing the import licence. It is on the basis of this finding that the Tribunal has held that there was no liability for capital gains tax. The decision of this court in Commissioner of Income-tax v. K. Rathnam Nadar [1969] 71 ITR 433 (Mad), as mentioned above, was relied on by the Tribunal in support of its conclusion. In that case which dealt with a case of transfer of goodwill the questi....

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.... 9, 10 and 12 (of the Indian Income-tax Act, 1922). Sub-clause (ii) of sub-section (2) may suggest that the capital gain arises only on the transfer of a capital asset which has actually cost to the assessee something in money. The actual cost in the context of the Income-tax Act can only be cost in terms of money. It cannot, it would appear, apply to transfer of capital assets (assuming that the ....