COMMISSIONER OF INCOME TAX Vs. M A CHIDAMBARAM

JUDGEMENT

(1.) THE assessee is maintaining horses which are also owned by the assessee for the purpose of running them in horse-races. THE assessee incurred expenditure on such maintenance during the previous year relevant to the assessment year 1979-80. THE horses so maintained by the assessee did not participate in any of the races during that year and the assessee did not have any income from participation in race including horse-race in that year.

(2.) THE assessee claimed that expenditure as loss for the year and sought to set off the same against the income derived by the assessee from other sources. That claim of the assessee was negatived by the Income Tax Officer but was accepted by the Commissioner. THE Tribunal affirmed the order of the Commissioner by holding that the source under which the cost of maintenance of the race-horses is to be considered is not any of the sources referred to in section 74A(2) of the Income Tax Act, 1961 (hereinafter referred to as 'the Act') but under the head 'Income from other sources' under section 56 and, therefore, that loss can be set off against the income derived from other businesses carried on by the assessee in that year.