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PETITIONER: CHAINRUP SAMPATRAM
Vs.
RESPONDENT: COMMISSIONER OF INCOME-TAX,WEST BENGAL.
DATE OF JUDGMENT: 09/10/1953
BENCH: SASTRI, M. PATANJALI (CJ) BENCH: SASTRI, M. PATANJALI (CJ) DAS, SUDHI RANJAN BOSE, VIVIAN HASAN, GHULAM BHAGWATI, NATWARLAL H.
CITATION: 1953 AIR 519 1954 SCR 211 CITATOR INFO : RF 1991 SC1338 (17)
ACT: Indian Income-tax Act (XI of 1922), ss. 4(1)(b) and 14(2)(c)-Ascertainment of profit by valuation of stock-Stock-in-trade removed to Native State-Place where profit accrues -Exemption under s. 14 (2) (c)-Principles underlying valuation of stock.
HEADNOTE: The assesses firm which carried on business at Calcutta in bullion despatched during the accounting year to Bikaner, where its partners resided, a certain quantity of silver bars and showed them a,; having been sold to the partners. The Income-tax authorities disbelieved the story of the sale and, treating the bars as stock-in-trade and valuing them at their market value at the close of the year which was much higher than the cost, assessed the firm’s profits at Rs. 2,20,887. The assessee contended that, even admitting that the bars were the stock-in-trade of the business, the increased value at the close of the year accrued at Bikaner and was exempt from tax in British India under s. 14(2)(c) of the Income-tax Act. The High Court held that...