TaxTMI 
TaxTMI 
1965 (12) TMI 42
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....une 29, 1941, from Hong Kong leaving an employee to look after his business there. During the year ending with December 31, 1946, he was a resident but not ordinarily resident of India within the meaning of the provisions of the Indian Income-tax Act. He was controlling the affairs of the Hong Kong business from Bombay during that year. But during the course of that year he went to Hong Kong on June 9, 1946, and returned to Bombay in September, 1946. For the assessment year 1947-48, the Income-tax Officer estimated his income from the Hong Kong business at Rs. 1,00,000, included the same in his assessment and assessed income-tax thereon. The assessee contended that the profits of the Hong Kong business were not taxable on the ground that he....
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....ng the accounting year for 8 months only and, therefore, proportionate profits attributable to the rest of the year were not exigible to tax; and (2) the loss suffered by the assessee in his business in Hong Kong during the period 1941 to 1945 was ascertained only after the termination of the Second World War in 1946 and, therefore, the loss must be deemed to have been incurred by the assessee only during the accounting year. To appreciate the first point, it is necessary to read the relevant part of section 4 of the Indian Income-tax Act, 1922, hereinafter called the Act, It reads : " 4. (1) Subject to the provisions of this Act, the total income of any previous year of any person includes all income, profits and gains from whatever so....
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....in this argument. But, this appeal does not call for an expression of a final opinion thereon, for both the Tribunal and the High Court held as a fact that the business was controlled during the entire accounting year from India. The Tribunal in its order dated October 5, 1956, held, on a consideration of the entire material placed before it, that the business was controlled from India. Adverting to the arguments of the learned counsel for the assessee before the Tribunal that the assessee's control extended only to a period of eight months out of twelve months, the Tribunal held that the business was controlled in India and that the assessee went out to Hong Kong only for a preliminary survey. The High Court also came to the same conclusio....
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.... the year 1941. The question ex facie does not comprehend the losses incurred in 1946 or ascertained during that year. The High Court, therefore, rightly held that the question framed by it was confined to the losses of the year 1941. But on an assumption not warranted by the question, the learned judges of the High Court, in deference to the arguments advanced by the counsel appearing before them, proceeded to consider the argument now raised before us and came to the conclusion that the said losses could not be held to have been sustained in the year 1946. In our view, it was not open to the High Court to answer the question not referred to it by the Tribunal. The Tribunal's order also shows that no such contention was raised before it ; ....