BANSIDHAR PRIVATE LIMITED Vs. COMMISSIONER OF INCOME TAX

JUDGEMENT

(1.) THE Tribunal has referred the following three questions of law for our opinion :

(2.) AT the hearing of the reference, it was stated on behalf of the assessee that the third question set out above is not pressed. It is, therefore, not necessary to consider the said question and to set out the facts bearing on the said question. The assessee is a private limited company. The assessment year is 1967 68, the previous year being the financial year ended March 31, 1967. The assessee was carrying on different business activities at different points of time and the following table gives a brief summary of those activities :

(3.) THE Tribunal relied upon the following facts and circumstances in arriving at its decision, (i) the several business were widely different in nature and they covered both manufacturing and trading activities ; (ii) the different businesses were carried on at different places ; (iii) each business had its own staff including different managers and the staff was not interchangeable ; (iv) inter se transactions between the various businesses were separately and meticulously recorded ; (v) the closure of one business was not shown to have affected the other businesses in fact, out of five different businesses, three had closed down without affecting the remaining two businesses which were still functioning ; (vi) different books of account were maintained for each business and separate P & L a/c and balance sheet were prepared in respect of each business although ultimately the accounts were consolidated into a common account ; (vii) the overall control of the board of directors over all the businesses, common ownership of the various businesses, common source of finance, consolidation of accounts and common assessment proceedings in different years were factors of no material importance ; (viii) even in the case of a limited company, there can be different businesses, although over all control is retained by the same board of directors. The question as to what constitutes "same business" has been considered in several decisions. We shall, however, briefly refer only to some of the leading decisions on the subject.