VIJAY KUMAR BUDHIA ANUSUIYA DEVI BUDHIA Vs. COMMISSIONER OF INCOME TAX PATNA:COMMISSIONER OF INCOME TAX PATNA

JUDGEMENT

(1.) Civil Appeal No. 2042 of 1984:

(2.) With a view to bring out the issue incontroversy more clearly, the High Court refrained the question in the following terms:

(3.) The assessee was a shareholder in a Private Limited Company. The Company went into liquidation. In those proceedings, the assessee received certain assets towards the shares held by him. In the assessment proceedings relating to the relevant years, question arose whether the assets so received by the assessee can be treated as his income by way of capital gains. The I.T.O placed his own value on the said assets and levied the tax. Assessee's contention was that inasmuch as there was no transfer of property and since the income did not arise from any such transfer, no capital gains could be said to have arisen. This plea was negatived by the I.T.O. When the matter ultimately reached the High Court, it ruled against the assessee relying upon the specific provisions contained in sub-sec. (2) of S. 46. Section 46 of the Income-tax Act reads as follows: