COMMISSIONER OF INCOME TAX Vs. MANILAL RAYARAM MEHTA

JUDGEMENT

(1.) THE assessee in the accounting year shipped 236 bales or cloth to a consignee In Mauritius, THE consignment was made contrary to the directions of the Government here that export to Durban was prohibited, at which port these goods were landed, and the result of this action on the part of the assessee was that the assessee's license for exporting goods was suspended.

(2.) IN our opinion, the facts of this, case are not distinguishable on principle from our decision in -- 'Commissioner of INcome-tax & Excess Pro-fite tax, Bombay City v. Shamsher Printing Works', AIR 1954 Bom 137 (A). That was a case where under the Defence of INdia Rules the asses-see's business was requisitioned by Government and Government paid compensation for the damage caused to the assessee by such requisttion, and we held that the payment constituted a capital receipt or a casual and non-recurring receipt and was not liable to tax, and we there pointed out that damages recovered as compensation for loss or damage caused to a capital asset can never be a revenue receipt, and we also pointed out that the real question that has got to be considered in such cases is what is the quality of the payment irrespective of what measure might be adopted in order to ascertain the loss caused to the assessee.