COMMISSIONER OF INCOME TAX Vs. PALANIAPPA TRANSPORT

JUDGEMENT

(1.) THREE questions have been referred to us at the instance of the Revenue which relate to the assessment year 1973-74. The questions referred are the following :

(2.) COUNSEL agree that the first two questions are to be answered against the Revenue, and in favour of the assessee, in the light of the decisions of the Supreme Court in Malabar Fisheries Co. v. CIT [1979] 120 ITR 49 and CIT v. Dewas Cine Corporation [1968] 68 ITR 240, in so far as the first question is concerned and the decision of the Supreme Court in the case of Addl CIT v. Mohanbhai Pamabhai [1987] 165 ITR 166, in so far as the second question is concerned.

(3.) THE liability of Manickam to pay a sum of Rs. 1,35,000 as noted by the Tribunal was a liability which arose only after he took over the assets in addition to the buses' allotted to him and the value of the assets so taken over were found to be in excess of what he was entitled to and, therefore, the debit of Rs. 1,55,000.