COMMISSIONER OF INCOME TAX Vs. KALINGA INDUSTRIES LIMITED

JUDGEMENT

(1.) THE question referred to this Court under Section 256(1) of the Income Tax Act, 1961 (hereinafter to be referred to as the Act) runs thus:

(2.) RELEVANT facts as appear from the statement of the case may be stated in short. There was on agreement on 1st April, 1963 entered into between Messrs. Kalinga Industries Ltd. (hereinafter to be referred to as the company) and the Industrial Development Corporation of Orissa Limited (hereinafter to be referred as the Corporation). Under the agreement the company agreed to transfer the properties and assets of the Low Shaft Furnace Pig Plant to the Corporation in accordance with the terms contained therein. Clause 2 of the agreement provided, inter alia, that the consideration for the sale shall be equivalent to aggregate of the following:

(3.) THE word "sale" has not been defined in the Income Tax Act. Sale of immovable property must accordingly be construed as it is understood in Section 54 of the Transfer of Property Act. Sale of movable property would be guided by the definition as given in the Sale of Goods Act. It is settled that where by one and the same transaction both immovable and 'movable properties are transfer the transaction would be governed by the provision; of law relating to immovable property. The matter is concluded by Commissioner of Income -tax v. Bhurangya Coal Co., 341. T.R. 802 (S.C).