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PETITIONER: M/S. S. C. CAMBATTA & CO. PRIVATE LTD., BOMBAY
Vs.
RESPONDENT: THE COMMISSIONER OF EXCESS PROFITS TAX BOMBAY
DATE OF JUDGMENT: 30/11/1960
BENCH: HIDAYATULLAH, M. BENCH: HIDAYATULLAH, M. KAPUR, J.L. SHAH, J.C.
CITATION: 1961 AIR 1010 1961 SCR (2) 805 CITATOR INFO : R 1972 SC2373 (11)
ACT: Excess Profits Tax--Assessment--Sale of theatre and restaurant--Goodwill--Value of--Principle of computation- Excess Profits Tax Act, 1940 (XV of 1940).
HEADNOTE: The appellant carried on various businesses and one such was the running of a Theatre and Restaurant. In October, 1943, a subsidiary company was formed which was using the premises of the Theatre under a lease granted to it from April, 1944. In working out the capital of the two companies for excess profits tax, a claim of rupees five lakhs for goodwill as part of the capital of the subsidiary company was not taken into account. On reference to the High Court it held that the Tribunal should have allowed the value of the goodwill whatever it thought was reasonable at the date of transfer. Thereafter the Tribunal took into account only the value lease-hold of the site to the subsidiary company and came to the conclusion that no goodwill had been acquired by the business of the Theatre as such and whatever goodwill there was related to the site of building itself, and estim...