COMMISSIONER OF INCOME TAX Vs. RATANSHI BHAVANJI

JUDGEMENT

(1.) AN interesting question has been referred to us for decision under Section 66(1), Income-tax Act, by the Income-tax Appellate Tribunal. The question for decision is:

(2.) IT would be seen from this statement that the family incurred a loss of Rs. 52569 in speculation. This loss was set off by the Income-tax Officer--which was affirmed by the Appellate Assistant Commissioner against the profits not only of the joint family but also against the taxed share income of the kartha from Messrs. Dharmashi Bros., which was a sum of Rs. 22,440. The balance of Rs. 26,927 was allowed to be carried forward under Section 24 (2) of the Act. The Appellate Tribunal reversed the decision of the revenue department and held that the loss could not be set off against the taxed share income from the unregistered firm received by the assessee during the year. At the instance of tile Income-tax Commissioner this reference was made to this Court. The question is whether the view taken by the Appellate Tribunal was right or whether the view of the department should prevail.