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