COMMISSIONER OF INCOME TAX Vs. AMBADI ENTERPRISES LIMITED

JUDGEMENT

(1.) THESE questions have been referred to us at the instance of the Revenue and relate to the assessment years 1974-75 and 1977-78. The questions referred are :

(2.) THE answer to all the questions referred is dependent on the answer to the question as to whether after the acquisition of the land to an extent of 170.5 grounds situated in Nawab Gardens, Adyar, by the assessee on February 13, 1968, the assessee had intended to hold that land as stock-in-trade and, therefore, by the sale of that land in the years subsequent to 1972, it should be valued at the market rate with reference to consideration paid by it in the year 1968 as its cost of acquisition or whether as claimed by the assessee the cost of acquisition should be computed with reference to July 6, 1972, on which date the company decided to treat this investment as its stock-in-trade by developing the land into plots and selling the sites so formed in the lay out.