LexTHE COMMISSIONER OF INCOME-TAX, MADHYA PRADESH versus SETH KHUSHAL CHAND DAGA
Open in Lexace · Ask the AI about this caseJudgment (excerpt)
186
SUPREME COURT REPORTS
[1962]
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persons and was rightly so assessed to Income-tax
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and Excess Profits Tax.
The Commission"
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of Income-tax,
e appea s are t ere1ore a owe wrt
costs. One
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hearing fee.
v.
Buldana District
Main Cloth
Importers Group
Kapur 1
March 7.
Appeals allowed.
THE COMMISSIONER OF INCOME-TAX,
MAD HY A PRADESH
v.
SETH KHUSHAL CHAND DAGA
(J. L. KAPUR, M. HIDAYATULLAH and
J. c. SHAH, JJ.)
Income Tax-Set-of! of loss-Amount computed not notified in
writing-Effect-Income-tax Act, 1922 (XI of 1922), ss. 24, 24(3).
For the accounting year 1941 the assessee's profits from his
share in an unregistered firm were set off against his losses in
the individual business and the Income Tax Officer determined
the loss to be carried forward at Rs. 53,840, but did not notify
to the assessee by order in writing the amount of the Joss as
computed by him as required by s. 24(3) of the Act. The asses-
see appealed against the assessment but did not question the
amount of the loss which had been determined. In the year
1942-43 the assessee claimed to re-open the question of the Joss
to be carried forward stating that it was Rs. 2,u,760. This
contention was rejected by the Tribunal.
The contention was
again raised by the assessee in the assessment years 1948-49 and
1949-50.
The question was whether the loss which had been deter-
mined and ordered to be carried forward must be deemed to
haye become final because no appeal was filed against that
determination.
Held, that computation of the amount of loss under s. 24 of
the Income-tax Act does not become final unless the Income-tax
Officer notifies by order in writing, the amount of the loss as com-
. puted by him to the assessee. The assessee was entitled to have
•
I S.C.R. SUPREME COURT REPORTS
187
the loss redetermined in a sub•equent year though he had not
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filed an appeal against the determination of _the lo_ss but no
--. .
.
appeal could be filed in the absence of an order in wnt1ng.
The Commissionef
Seth ]amnadas Daga v. The Commissioner of Income-tax,
0! Income-tax,
[rg6r] 3 S.C.R. r74, applied.
Madhya Pradesh
v.
CIVIL APPELLATE JURISDICTION:
Civil Appeals
Stth Khushal
Nos. 148 to 150 of 1960.
Chand Daga
Appeals by special leave from the judgment and
order dated October 31, 1956, of the former Nagpur
High Court in Misc. Civil Case ~o. 184 of 1953.
K. N. Rajagopala Sastri and D. Gupta, for the
appellants.
J. M. Thakar, S. N. Andley, J. B. Dadachanji and
Rameshwar Nath, for the respondents.
1961. March 7. The Judgment of the Court was
delivered by
HIDAYATULLAH, J.-These appeals, by special leave, flidayatullah J.
have been filed by the Commissioner of Income-tax,
Madhya Pradesh, against the assessee, an individual,
by name Seth Khushal Chand Daga. The assessee
was a partner in a firm, Messrs. R. B. Bansilal Abir-
chand of Nagpur. In the year of account ending
Diwali, 1941, he received his share of assets and pro-
perty from this firm, and started business of his own.
In the same year, his sources of income were specula-
tion, allowance from Government as treasurer, house
property and dividends. The assessee had received
some profits from his share in an unregistered firm
against which were set off his losses in his individual
business, and the Income-tax Officer, who made the
assessmenL, determined the loss to be carried forward,
at Rs. 53,840. The assessee appealed against the
assessment, but did not question the loss which had
been determined.
For the year, 1942-43, the assessee claimed to re-
open the question of the loss to be carried forward,
stating that it was Rs. 2,ll,760. This contention was
not accepted by the Department, and on appeal, by
the Tribunal. The contention was, however, raised
again by him in the assessments for the years, 1948-
49 and 1949-50. In these years, he had profits from
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SUPREME COURT REPORTS
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his share in the unregistered firm, Rs. 1,82,773 and
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Rs. 1,39,922 respectively, against which were set off
0~ r:::;'.;::~" his losses in his individual business, Rs. 1,18,913 and
Madhya Pradesh Rs. 60,589 respectively. The contention of the as-
v.
sessee was that the profits which he had derived from
Seth Khushal the unregistered firm could not be set off against the
Chand naga
loss in his individual business, as the profits of the
HidayatuUah 1. unregistered firm had borne taExcerpt shown. Read the full judgment & AI analysis in Lexace.