COMMISSIONER OF INCOME TAX Vs. RAMAIAH R

JUDGEMENT

(1.) THE Income-tax Appellate Tribunal, Bangalore Bench, has referred the following question under s. 256(1) of the I.T. Act, 1961, at the instance of the Revenue :

(2.) THIS is the common question that arises for consideration in all these references.

(3.) THE question herein is whether the assessee in each of these cases did any business in purchasing and disposing of the lands by forming house sites."Business" is defined u/s. 2(13) of the Act to include any trade, commerce or manufacture or any adventure in the nature of trade, comerce or manufacture.This definition is of wide amplitude, taking within its fold, dealings in real property and includes an active occupation continuously carried on with a profit motive. It also includes an adventure in the nature of trade. THE object of the definition of business in the Act is to treat the receipts from an adventure also to tax just as the receipts from trade profit are brought to tax. THE cases of realisation of investments consisting of purchase and sale of lands sometimes present difficulty. In each case, however, one has to determine the nature of the transaction, its volume, frequency, continuity and regularity. THEre is hardly any abstract rule, principle or test for application. In G. Venkataswami Naidu and Co. v. CIT [1959] 35 ITR 594, the Supreme Court observed at p. 609 :