| Case ID |
735cc7c7-1e08-49cc-912c-4a3b182972e4 |
| Body |
View case body. Login to View |
| Case Number |
CIVIL APPEAL Nos. 581 TO 584 OF 1966 |
| Decision Date |
Nov 22, 1967 |
| Hearing Date |
Apr 17, 1967 |
| Decision |
The Supreme Court upheld the findings of the Tribunal and the High Court, concluding that the income derived by the assessee from the sale of its shares and securities was a revenue receipt and, therefore, taxable under the Income-tax Act. The Court found that the shares were purchased and sold with the motive of earning a profit, rather than as a legitimate investment. It highlighted that the circumstances indicated an adventure in the nature of trade, given that the shares were bought during a falling market and sold at a profit. The appeals were dismissed, confirming the lower courts' decisions against the assessee. |
| Summary |
In the landmark case of Dalhousie Investment Trust Co. Ltd. v. Commissioner of Income Tax, the Supreme Court of India addressed crucial issues regarding the taxation of income derived from the sale of shares. The case revolves around whether the profits from the sale of shares by Dalhousie Investment Trust were taxable as revenue receipts under the Income-tax Act, 1961. The Court examined the nature of the transactions, the intent behind the share purchases, and the circumstances surrounding their sale. The Tribunal and High Court had previously determined that the shares were sold with the primary motive of profit, rather than for investment purposes, which led to the conclusion that the income was taxable. This case emphasizes the importance of intent in determining the nature of financial transactions and has significant implications for investment firms regarding tax liabilities. Keywords such as 'Income Tax', 'Revenue Receipt', 'Taxable Income', and 'Investment Strategy' are essential for understanding the case's impact on tax law and corporate investment practices. |
| Court |
Supreme Court of India
|
| Entities Involved |
Not available
|
| Judges |
J.C. Shah,
V. Ramaswami,
V. Bhargava
|
| Lawyers |
A.K. Sen,
Bishan Narain,
R.K. Chaudhuri,
B.P. Maheshwari,
Niren De,
T.A. Ramachandran,
R.N. Sachthey,
S.P. Nayyar
|
| Petitioners |
Dalhousie Investment Trust Co. Ltd
|
| Respondents |
Commissioner of INCOME TAX
|
| Citations |
1968 SLD 146,
(1968) 68 ITR 486
|
| Other Citations |
Bengal and Assam Investors Ltd. v. CIT [1966] 59 ITR 547 (SC),
CIT v. Bai Shirinbai K. Kooka [1962] 46 ITR 86 (SC),
Dalhousie Investment Trust Co. Ltd. v. CIT [1967] 66 ITR 473 (SC),
CIT v. Ramnarain Sons (P.) Ltd. [1961] 41 ITR 534 (SC)
|
| Laws Involved |
Income-tax Act, 1961
|
| Sections |
4
|