APPANNA K T Vs. COMMISSIONER OF INCOME TAX

JUDGEMENT

(1.) THE question referred to this Court for its opinion is :

(2.) ON 19th Jan., 1949, the assessee and three other persons constituted a partnership with a view to carry on business on the terms and conditions contained in the deed entered into by them. In pursuance of that agreement, they purchased on 20th Jan., 1949, in their joint names two bungalow sites in Malleswaram. The object was to convert those sites into smaller building sites and effect sales thereof. The partners appointed one among them as their power-of-attorney for the purpose of carrying on the business of the partnership. ON 6th June, 1956, the partnership was dissolved. By that time the firm had sold all the sites excepting 17 sites. ONe of the 17 sites was given to charity. The remaining 16 sites were divided between the four partners, and each of the partners got four sites. Thereafter, the assessee sold the sites that fell to his share.

(3.) ONE of the circumstances relied on by the Tribunal for coming to the conclusion that the assessee carried on the business of selling house sites is that he sold one of the sites by auction. From this circumstance it is not possible to draw the inference that he was selling the sites in question in the course of his business. It is open to any private owner to sell his sites by auction. The fact that the assessee did so does not in any manner lend itself to an inference other than that that can be drawn in the case of any other individual.