TaxTMI 
TaxTMI 
1961 (1) TMI 3
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....of the appellant firm were also partners of Messrs. Morarka & Co., who were the managing agents of the Sholapur Spinning and Weaving Company Ltd. hereinafter called the Sholapur Mills. The firm commenced business in August, 1942. In Samvat year 2000 (November, 1943, to October, 1944) the appellants purchased seventeen ordinary shares of the Sholapur Mills and thereafter they purchased 82 more ordinary shares between November, 1944, and October, 1948. By November, 1948, the appellants held 99 ordinary shares. The appellants also purchased at diverse times 6,780 preference shares of the Sholapur Mills. All these shares were entered in the books of account of the appellants as stock-in-trade and valued accordingly at the end of each accounti....
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....leged to have resulted to the appellants in the corresponding year of account. But in appeals to the Appellate Assistant Commissioner by three orders dated May 4, 1951, the shares of the Sholapur Mills were held to be stock-in-trade and the profits or losses computed according to the method of valuation adopted by the appellants were directed to be taken into account in assessing the taxable income. These orders were not challenged in appeals to the Income-tax Appellate Tribunal. In the assessment year 1948-49, the appellants did not furnish return and they were assessed to tax under section 23(4) of the Income-tax Act. For the assessment year 1949-50, the appellants furnished their return claiming that they incurred a loss of Rs. 3,33,85....
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....hether the Tribunal misdirected itself in law and/or acted without any evidence in finding that the investment of the assessee in the shares of the Sholapur Mills was a capital investment and not its stock-in-trade ? (2) Whether in any event in view of the assessments made for the years 1945-46, 1946-47 and 1947-48 and the Appellate Assistant Commissioner's order for these three years, it was open to the department to hold for the assessment years 1949-50 that the said shares do not represent the assessee's stock-in-trade ? (3) Whether the Tribunal misdirected itself in law in omitting to consider certain material facts which were taken into account by the Appellate Assistant Commissioner and expressly mentioned in the Appellate Assista....