Wednesday, December 14, 2011

Compilations of case law : RECEIPTS DURING DISCONTINUANCE OF BUSINESS

INCOME – CHARGEABILITY AND COMPUTATION


RECEIPTS DURING DISCONTINUANCE OF BUSINESS



No purchase and sale after certain date and employees discharged- Mere realization and payment for some time – Discontinuance of business


Ghanshyam Das Gangadhar Vs CIT (Pat) 19 ITR 349



When assessee's business has come to a close or when the assessee let out the assets with the intention of closing the business, the property which at one time was a commercial asset would cease to be so and the income from letting out of such an asset would not be business income.


New Savan Sugar & Gur Refining Co. Ltd. Vs CIT (SC) 74 ITR 7


Metal Products of India Vs CIT (P&H) 293 ITR 618



After discontinuing business, machinery and vehicles let to sister concerns - Hire charges received is income from other sources – Let out property with amenities – Air conditioning charges received is income from other sources.


Express News papers Pvt. Ltd. Vs CIT (Mad) 227 ITR 325


Madras Silk & Rayon Mills P. Ltd. Vs ITO & Anr.(Mad) 262 ITR 122 – rental income


from factory building.



Assessee not carrying on any business during the year – lease rent of machinery – Other Sources income.


CIT Vs K. Narendra (Del) 246 ITR 579



Business closed and quarters attached to factory let out – Rental income – Not business income.


CIT Vs Ramdas & Sons (Patna) 236 ITR 786; 225 ITR 416


The Saswad Mali Sugar Factory Limited Vs CIT (Bom) 236 ITR 706


Narain Swadeshi Weaving Mills Vs Comm. Of Excess profits Tax (SC) 26 ITR 765 (Plant & Machinery let out)


Universal Plast Limited etc. Vs CIT (SC) 237 ITR 454



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