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PETITIONER: HOSHIARPUR ELECTRIC SUPPLY CO.
Vs.
RESPONDENT: COMMISSIONER OF INCOME TAX, SIMLA
DATE OF JUDGMENT: 06/12/1960
BENCH: SHAH, J.C. BENCH: SHAH, J.C. KAPUR, J.L. HIDAYATULLAH, M.
CITATION: 1961 AIR 892 1961 SCR (2) 956
ACT: Income Tax--Assessee’s receipts for installing new electricity installations--If "Profit" or capital--Indian Electricity Act, 1910 (9 of 1910), Schedule c. 6 (1)(b)--Indian Income-tax Act, 1922 (11 of 1922), s. 66(1).
HEADNOTE: The assessee, an electricity supply undertaking, received certain sum of money for new service connections granted to its customers. Part of this amount was spent for laying mains and service lines. The Income-tax Officer treated the entire amount as trading receipt. In appeal the Appellate Assistant Commissioners excluded the cost of laying service lines and the mains and treated the balance as taxable income. The Appellate Tribunal agreed with the Appellate Assistant Commissioner and held that the service connection receipts were trading receipts and the "profit element" therein was taxable income in the hands (1)[1929] A.C. 386; (1929) 14 T.C. 433. 957 of the assessee. In a reference under s. 66(1) of the Income-tax Act, the High Court substantially agreed with the view of the Tribunal. On appeal by the assessee, Held, that the High Court erred in holding that the excess ...