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PETITIONER: RAJA BAHADUR VISHESHWARA SINGHAND OTHERS.
Vs.
RESPONDENT: COMMISSIONER OF INCOME-TAX, BIHARAND ORISSA
DATE OF JUDGMENT: 15/12/1960
BENCH: KAPUR, J.L. BENCH: KAPUR, J.L. HIDAYATULLAH, M. SHAH, J.C.
CITATION: 1961 AIR 1062 1961 SCR (3) 287
ACT: Income Tax-Purchase and sale of shares and securities with surplus money-Such transactions, if amount to investment or business in shares-Test-Excess sale proceeds-If amount to business profit or mere accretion to capital-Indian Income- tax Act, 1922 (11 of 1922), s. 66(2).
HEADNOTE: The appellant used to invest his cash surplus in shares and securities and maintained an account book called Book No. 1 relating thereto. During the period from 1930 to 1941-42 he purchased a large number of shares and securities which by the accounting year 1941-42 were of a value Rs. 1491 lacs. He sold certain shares and securities of the value of several lacs and made certain amount of profit on those sales. In 1940 the appellant borrowed a large amount of money from his brother, the Maharaja of Darbhanga and opened a new account named account No. 2 which contained all entries regarding shares purchased and sold out of the money borrowed from the Maharaja. In the assessment year 1944-45 to 1948-49 the profits made by the (1) [1961] 3 S.C.R. 279. 288 appellant from purchase and sale of shares amounted to several la...