# THE NEW JAHANGIR VAKIL MILLS co.,-LTD. BHAVNAGAR v. THE COMMISSIONER OF INCOME-TAX, BOMBAY NORTH, KUTCH & SAURASHTRA, AHMEDABAD

- **Citation:** [1964] 2 S.C.R. 971
- **Court:** Supreme Court of India
- **Decided:** 1964
- **Bench:** S. I\. Das, A. K. Sarkar, M. Hidayatullaji
- **Source:** https://unisonlegal.in/judgment/supreme-court-of-india/the-new-jahangir-vakil-mills-co-ltd-bhavnagar-v-the-commissioner-of-income-tax-2865
- **Pages:** 11

## Headnote

Income Tax-Aase,.ee dealer in shares and securities-Income from sale shares, if revenue receipt-Profits if be computed
on basis of difference between original cost price and price realized
at the sale-Res judicata, if appliable ta matters of taxation
-Taxing
authorities
if can consider position of assessee
before the assessment year.
The assessee appellant carried on the business of manufacturing and selling
textile
pit-ce·goods.
In the assessment
year 1945-46, the Income-tax Officer added to the taxable
income of the assessee a sum of Rs. L86,931 which \-Vas later
on reduced to Rs. 1,23,840 as a revenue receipt, representing
an amount by which the sale price exceeded the orginal cost
of certain shares and securities purchased and sold by the
appellant. The assessee was held to be a dealer in shares and
sec,μrities.
The contention of the a'isessee was that it was not a
dealer in shares and securities in the relevant account year or
in the years past and the shares and securities were held by
way of investment and the investment surplus was in the nature
of capital receipt.
Even if the assessee was a dealer in shares
and securities in the relevant account year, the Income-tax
Officer committed an error in the matter of the computation
of profits in not taking the 1narket value of the shares as at the
opening day of that year as the cost thereof. The Appellate
Assistant Commssioner rejected the contentions of the appellant
and held that the number of transactions was sufficiently large
to show that the assess<e was a dealer in shares.
The Appellate
Tribunal rejected the contentions of the appellant. These
assertions were then referred to the High Court and they were
decided against the assesscc-appellant,
1963
A;ril JO.
1963
N1w JtWM:ir Vokii
Mill• C.., l.td
llhaunag~r
v.
Commi;siOAtr of
/nCfmt ·tax, B•mha1
NMlii Ku1c .. , &! Sau·
ra1h1,a, !lmtttlabad
I as J.
972 SUPREME COURT REPORTS (1964] VOL.
Held that the asscssee ,,·as a dealer in shares and securities
and the income from their sale \\·.as a rcvr.nue receipt and not
capital receipt.
The profits of the assessee were the difference
bet\\'Cr.n the original cost prict· of the shares to the assessce at the
time of purchase and thr price rcalizec.J at the tiine of sale.
field
also that in the nlattcr or taxation, there \'/as no
question of resjudicata" It \V<lS open to the taxing auth·,rities
to consider the position of the aS!es'ce in 1943 for the purpose
of detrrmining hov.· 1he gains made in 1944 should be computed, even though the suh_ject of the assessmcut proceedings
\\'as the cornputation of the profits n1a<le in 1914.
l"hc circumstance that in an t"arlicr assessment relating to 1943, the
assessee \\'as treated as an investor \VOuld not estop the assessin~
authorities from consirle1 in~, for the purpose of computation
of the profits of 194·1 1 as to when thr: trading activity of the
assesscc in shares began.
'l'he assessing authoritirs found that
it began in 1943 and on that finding, the profits were correctly
computed.
(}ornmissioner of Income-tax v. Bai ,<)hiriHbai K. Kooka,
11952] Supp. 3 S.C.R. 391, Broken l/ill Prop<rly Company v.
Broken Hill Municipal Council, [1926] A.C. 94, Hoyst<ad v.
Commi-.q°<mcr n.f Tu.ration, [ 1926] A.C. 15:>. Society of Medical
Officu of lle"lth v. Hope, (1960] AC. 551, Cuffonr v. Inr.mne·
tax Commi,.oimier, ( 1961 J A.C. 584 and ln .. talme11t
Supply
(l') Ltd. v. Union of India, [1962] 2 S.C .. R. 644, referred to.
Cn·rr, APPELLATE Jc!USDIC'l'Io:>": Civil Appeal
No. 445 of 1962.
Appeal from the judgment and order dated
April I I and 12. I !JOO, of the Bombay High Court
in Income-tax Reference ;\lo. :i2 of 195!!.
R . ./. l<:f!/Jih and /.S. Shroff, for the appellant.
K. N. Rrijugf!pnl Sastri, anJ H.S. Sachthey,
for the respondent.
1963. April 10. The .Judgment of the Court was
delivered by
S. K .. DAR, ].-This is an appeal on a certi·
ficate of fitness
granted by the High Court of
• -
'
,.
. -
, .
2 S.G.it
SUPREME COURt REPORTS 973
Bombay u

## Text

•
- .
2 S.C.R.
SUPRENIE COURT REPORTS
971
THE NEW JAHANGIR VAKIL MILLS
co.,-LTD. BHAVNAGAR
v.
THE COMMISSIONER OF INCOME-TAX,
BOMBAY NORTH, KUTCH
&
SAURASHTRA, AHMEDABAD
(S. I\. DAS, A. K. SARKAR and
M. HIDAYATULLAJI jj.)
Income Tax-Aase,.ee dealer in shares and securities-Income from sale shares, if revenue receipt-Profits if be computed
on basis of difference between original cost price and price realized
at the sale-Res judicata, if appliable ta matters of taxation
-Taxing
authorities
if can consider position of assessee
before the assessment year.
The assessee appellant carried on the business of manufacturing and selling
textile
pit-ce·goods.
In the assessment
year 1945-46, the Income-tax Officer added to the taxable
income of the assessee a sum of Rs. L86,931 which \-Vas later
on reduced to Rs. 1,23,840 as a revenue receipt, representing
an amount by which the sale price exceeded the orginal cost
of certain shares and securities purchased and sold by the
appellant. The assessee was held to be a dealer in shares and
sec,μrities.
The contention of the a'isessee was that it was not a
dealer in shares and securities in the relevant account year or
in the years past and the shares and securities were held by
way of investment and the investment surplus was in the nature
of capital receipt.
Even if the assessee was a dealer in shares
and securities in the relevant account year, the Income-tax
Officer committed an error in the matter of the computation
of profits in not taking the 1narket value of the shares as at the
opening day of that year as the cost thereof. The Appellate
Assistant Commssioner rejected the contentions of the appellant
and held that the number of transactions was sufficiently large
to show that the assess<e was a dealer in shares.
The Appellate
Tribunal rejected the contentions of the appellant. These
assertions were then referred to the High Court and they were
decided against the assesscc-appellant,
1963
A;ril JO.
1963
N1w JtWM:ir Vokii
Mill• C.., l.td
llhaunag~r
v.
Commi;siOAtr of
/nCfmt ·tax, B•mha1
NMlii Ku1c .. , &! Sau·
ra1h1,a, !lmtttlabad
I as J.
972 SUPREME COURT REPORTS (1964] VOL.
Held that the asscssee ,,·as a dealer in shares and securities
and the income from their sale \\·.as a rcvr.nue receipt and not
capital receipt.
The profits of the assessee were the difference
bet\\'Cr.n the original cost prict· of the shares to the assessce at the
time of purchase and thr price rcalizec.J at the tiine of sale.
field
also that in the nlattcr or taxation, there \'/as no
question of resjudicata" It \V<lS open to the taxing auth·,rities
to consider the position of the aS!es'ce in 1943 for the purpose
of detrrmining hov.· 1he gains made in 1944 should be computed, even though the suh_ject of the assessmcut proceedings
\\'as the cornputation of the profits n1a<le in 1914.
l"hc circumstance that in an t"arlicr assessment relating to 1943, the
assessee \\'as treated as an investor \VOuld not estop the assessin~
authorities from consirle1 in~, for the purpose of computation
of the profits of 194·1 1 as to when thr: trading activity of the
assesscc in shares began.
'l'he assessing authoritirs found that
it began in 1943 and on that finding, the profits were correctly
computed.
(}ornmissioner of Income-tax v. Bai ,<)hiriHbai K. Kooka,
11952] Supp. 3 S.C.R. 391, Broken l/ill Prop<rly Company v.
Broken Hill Municipal Council, [1926] A.C. 94, Hoyst<ad v.
Commi-.q°<mcr n.f Tu.ration, [ 1926] A.C. 15:>. Society of Medical
Officu of lle"lth v. Hope, (1960] AC. 551, Cuffonr v. Inr.mne·
tax Commi,.oimier, ( 1961 J A.C. 584 and ln .. talme11t
Supply
(l') Ltd. v. Union of India, [1962] 2 S.C .. R. 644, referred to.
Cn·rr, APPELLATE Jc!USDIC'l'Io:>": Civil Appeal
No. 445 of 1962.
Appeal from the judgment and order dated
April I I and 12. I !JOO, of the Bombay High Court
in Income-tax Reference ;\lo. :i2 of 195!!.
R . ./. l<:f!/Jih and /.S. Shroff, for the appellant.
K. N. Rrijugf!pnl Sastri, anJ H.S. Sachthey,
for the respondent.
1963. April 10. The .Judgment of the Court was
delivered by
S. K .. DAR, ].-This is an appeal on a certi·
ficate of fitness
granted by the High Court of
• -
'
,.
. -
, .
2 S.G.it
SUPREME COURt REPORTS 973
Bombay under s. 66-A (2) of the Indian Income-tax
Act, 1922. The New Jehangir Vakil Mills Co., Ltd ..
Bhavnagar, appellant before us
and called the
assessee, carried on the business of manufacturing
and selling textile piecegoods at Bhavnagar in the
former Bhavnagar State. The
present appeal is
concerned with the assessment year 1945-46, the
account year being the calendar year 19±4. In the
said assessment
year the Income-Tax
Officer
concerned added to the taxable income of the
assessee a sum of Rs. 1,86,931/· (which was later
reduced to Rs. 1.23,840/·) as a revenue receipt,
representing an amount by which the sale price
exceeded the original cost of certain shares and
securities purchased and sold by the appellant. It
was held that in the relevant account year in which
tthe shares were sold and profits made as also in the
wo preceding years, the assessee was a dealer in
8hares and securities. In respect of this addition of
Rs. 1,23.840/· the assessee raised two contentions.
The first contention was that it was not a dealer in
shares and securities in the relevant account year
or in the years past and that the shares and securities
were held by way of investment and the investment
surplus was in the nature of a capital receipt. The
second contention was that even if the assessee was a
dealer in ~hares and securities in the relevant account
year, the Income-tax Officer committed an error in
the matter of the computation of profits in not taking
the market value of the shares as at the opening day
of that year as the cost thereof.
These were the two questions along with a
third question which were referred to the High
Court under s. 66 (2) of the Act. The third question
does not now survive, and therefore we set out below
the two questions which fall for decision in this
appeal:
1.
In the event of the surplus aforesaid beingheld to be income assessable to income-tax
1963
NeUJ Jahan.gir Vdil
MillJ Co., Lid.
Bharma1ar
v,
Commissiontr f1j
Income-tax, Bombtiy
North, K11.t&h & Sau·
rashJra, ~hmrd.Oa-1
Das/.
1963
New faMngu l"ahJ
1'J1lls (.o., Ltd
Bh~:1:11oga1
v.
Commi..ssion11 of
lncrnne·lox, Bc.mboy
North, J(ulclJ & Sauro.slitra, AhmttJabod
Das J.
974 SUPREME COURT REPORTS [1964) VOL.
whether the income should
be ascertained
by
taking the market value of
the shares as at the openi11g day of the year
as the cost ?
2.
Whether there is anv evidence on record
to justify the Trib~nal's finding that the
assessee company was a dealer in shares
not only in the year under consideration
but in the years past ? .
Now, as to the contention whether the asscssee
was a dealer or not in shares 1nd securities in the
calendar year I UH the position appears to be that
the Income-tax Officer found against the assessce.
There was an appeal 10 the appellate
Assistant
Commissioner who remanded the case to the Incometax Officer on the ground that the materials in the
record were not adequate to decide the question.
In
the remand proceedings the asscssec filed before the
Income-tax Officer statements showing the position
of transactions relating to shares and securities from
1939 onward.
These statements marked as annexure
'C' form part of the statement of the case.
In his
remand report dated April I, 1952 which is also a
part of the statement of the case, the Income-tax
Officer examined the purchase and sale of shares in
different years by the <tssessee and came to the
conclusion
that
the
assessee
was
a
dealer
in shares at least from the year 1942 by reason
of the
frequency
and
multiplicity
of
the
transactions
which
the
asscssee conducted since
that year. It further pointed out that the assessee
had sold certain shares out of a block of shares in the
year 1943, and after taking out the price of the
shares realised in 1943, the remaining amount was
shown in the balance sheet as the value of the remaining shares in each block. The value of such shares
as shown in the balance sheet for 19·!3 was not the
cost price of the assessce. In some cases it was below
-
, '
s.c.R..
SUPREME COURT REPORTS
975
cost.
As a result of this valuation in the balance
sheet, the profits from the sale of shares during 1945·
46 would be Rs. l,i3,840/·. If, however, the diffe·
rence between the sale price· and the market value
of the shares as on the first day of the account year
was taken into account, the results might be different.
On the basis of the aforesaid remand report the
Appellate Assistant Commissioner · examined
the
records of the transactions and observed :
"There are five
different
transactions of
purchase and two transactions of sale in 1942.
The tempo of purchases and sales goes up from
1943: There are purchases of fifteen or twen·
ty different dates in 1943.
There is a similar
number of transactions in 1944.
Many of the
shares purchased in 1943 have been disposed
of in 1944,
Several scrips purchased in 1944
have been sold within the year. The number
of transactions is, in my opinion, sufficiently
numerous to show that the assessee is a dealer
in shares."
There was an appeal then to the Tribunal.
The
Tribunal came to the conclusion that so far as
Government securities were concerned the asses see
was obliged to keep its large cash invest~d in Government securities and, therefore, so far as these securities
were
concerned,
the
amount
realised by their
sale was not a revenue receipt and
should not be included in the total income of the
a.ssessee.
It held, however, that the assessee was a
dealer in shares in 1944 and as to the computation
of the profits made on the sale of the shares, such pro·
fits were correctly computed to be the difference between the original cost price of the shares to the. asaessee at the time of purchase and the price.realised at the
time of sale, and the Tribunal sign.1ficantly added that
this computation was correct on the finding that the
19(;9
New /akanlir Vakil
Mills Co., Ltd.
Bhaonagar
v.
Commissioner of
'Income-tax, Bombay
North, Kutth & Sau·
tashtra, Ahmedabad
Das J.
JHJ
}if1w Jahangir Vuki•
.~1iUs Co , l.t1
Bhaunoiar
y,
l'cmmiSJi3'fn of
lnCAm•· la.(, Bombay
JVorlh Kutch & Sau·
rasJrtra_ Alimllafftl
Das J.
976
SUPREME COURT REPORTS (1964] VOL.
assessee was a dealer not on! y in l!J44 but from 1942
onward. \Ve may .here state that for the years prior
to the account year l!)H, the department had treated
the assessee as an investor and not a dealer in shares
and had made assessments accordingly for those years.
'I hose assessments have now become final.
When the matter went to the High Court on a
case stated by the Tribunal, the High Court observed
that the crucial year wa~ the year l 94il, for if the
assessee was a dealer in shares since 1943 and sold
some of them in the account year l!l44 and made
profits thereon, then both the questions referred to
the High Court must be 'answered against the assessee.
The High Court re-framed the second question
by substituting the words "in the year l!J43" for
the words "in the years past". The High Court further
pointed out that in the exercise of its advisory juris·
diction it did uot sit in appeal over the decision of
the Tribunal that the asscssee was a dealer in shares
in the year 1943. It also held that on the materials
on record it was opeu to the Tribunal to come to the
conclusion that the assessee was a dealer in shares in
1943 and as to the computation of profits it pointed
out that if the assessee was a dealer in 1943 also,
then it was not open to the assessee to say that the
market value of the shares as on the opening day of
the year
I !H4 should be taken as the cost of the
shares.
Accordingly, the High Court answered both
the questions against the asscssee.
'
•
'
Learned counsel for the appellant has addressed
us at length on both questions.
However, it appears
to us that hy reason of the re-framing of the second
question, the two questions really merge into one,
~'I
namely, was the ~essec a dealer in shares in 194 3
and continued to be such a dealer in 11144 which is
the relevant account year
~ The question no doubt
has two aspects.
Firstly, there is the aspect whether
there i; any evidence to justify the finding that the
\, .. .
•
2·S.C.ll.
SUPREME COURT REPORTS 077
assessee
was a
dealer
in ·shares
m
1943 .
Secondly, there is the: aspect as to how the profits
made from the sale of shares in 1944 should be
computed in
the assessment year 1945·46. It is
however manifest that if the assessee was a dealer
in HJ43 also, then the principle laid down by this
court in Commissioner OJ
lncorne-tax v. Bai Shirinbai K. Kooka (1), will not apply, for that decision
proceeded on the footing that the assessee of that
case converted
her
investment
shares into a
stock-in-trade and carried on a
trading activity
as from April 1, 1946, the relevant account, year
being the financial year 1946-4 7. If the assessee in
the present case was a dealer in 1943, then nothing
happened on the' opening day of the relevant account ·
year, namely, January 1, 1944 and there is no reason
why the market value of the shares on that date
should be taken into consideration in computing the
profits.
Learned counsel for the assessee has however pressed an argument which may now be stated.
He has submitted that he is not arguing that it was
not open to the assessing authorities to.consider the
question whether the assessee was a dealer in shares
in 1944 which was the relevant account year. What
he contends is that it was not open to the taxing
authorities to consider and find that the assessee was
a dealer in shares in 1943; because for all years prior
to 1944 the department had already assessed
the
assessee on the footing that it was an investor of
shares and not a dealer and those assessments having
become final could be re-opened only either under
s. 34 or s. 35 of the Act.
The argument is that in
assessing the assessee for the account year 1944 it
was open to the department to treat the assessee as a
dealer in 1944 but not for any earlier year which was
not the subject of the assessment proceedings. Learned
counsel states that if he is right in his first contention,
then the profits made on the sale of shares in 1944
must be computed in the manner laid down in Commissioner of Income-tax v. Bai Shirinbai K. Kooka( 1),
ti) [19621 Supp. 3 s.c.R. !9lo
........
1963
New· Jalwnzir V •kil
Mills Cn, Ltd.
Bha1JT1agar
v.
Commissiontr of
lncome~tax, Bombay
North, Kutch & Sau~
rashlra, Ahmeda6ad
Das J.
/96J
Jfov l•Mtitir Y.Ail
Mills C•. ltd.
Blwn(Jt•'
••
<Awunilsion.r of
f&DllfU·llJJt, Bombay
North, Kutch ft1 s.z..
11Jhlr•, Alrmedaid
/)., /.
978 SUPREME COURT REPORTs [1964] Vot·
because the assessee will be treated as a dealer
for the first time in
the relevant account year
1944.
The argument appears plaussi ble at first sight
and it may perhaps be conceded that the question of
the computation of profits in a case like this is not
entirely free from difficulty.
However, on a very .
careful consideration of the argument we have come
to the conclusion that it is not worthy of acceptance.
As to the first aspect of the question we sec
no
difficulty. The appellate
Assistant Commissioner
and the Tribunal have referred to various transac·
tions relating to shares shown in the books of the
assessee.
From those transactions thev came to the
conclusion that the assessee was a de~ler in 1943.
The High Court has also summarised the various
transactions in which the assessee indulged in the
year 1943.
Having regard to the
frequency and
nature of those transactions it was open to the taxing
authorities to come to the conclusion that the assessee
was a dealer in shares in 1943.
We arc not prepared
to say that the rule of "no evidence" can be applied
to the present case.
We therefore consider that the
High Court correctly answered the question relating
to this aspect of the case.
Now, as to computation of profits.
Though
it is true that the question which directly arose'
before the taxing authorities in the present case was
whether the assessee was a
dealer in 1944, the
9uestion
of
the
pos1uon
of
the
assessee
m
1943
also
arose
in
determining . how
the
profits made in 1944 should be computed. It is not
therefore quite correct to say that the position of the
assessee in 1943 was completely outside the scope
of the assessment proceedings of 1945-4fi.
In determining or computing the profits made by the sale
of shares in 1944, the assessing authorities had to go
into the question-did the assessee start its trading
. -
•
'
"
...
. .
2 S.C.R.
SUPREME COURT REPORTS
979
activity on January I, 1944 or did it start the trading
activity at an earlier date ? If the assessee was a
dealer when the shares sold in 1944 were originally
purchased, then obviously the principle in Commissioner of Income-tax v. Bai Shirin Bai K. Kooka
( 1 ), will not apply and the profits will be the excess
of the sale price over, the original cost price.
The
extent to which a decision 5iven by an Income-tax
0 fficer for one assessment year affects or binds a
decision for another year has been
considered by
courts several times and speaking generally it may
be stated that the doctrine of res judicata or estoppel
by record does not apply to such decisions; in some
cases it has been held that though the Income-tax
Officer is not· bound by the rule of res judicdta or
estoppel by record, he can re·open
a
question
previously decided only if fresh facts come to light
or if the earlier decision was rendered without taking
into consideration material evidence etc.
As to the
argument based on ss. 34 and 35, it is enough to
point out that the assessment relating to the year
1943 is not being reopened. That assessment stands.
What is being done is to compute the profits of 1944,
which the assessing authorities could do, by finding
out when the trading activity in shares began?
The
question of the profits in 1944 was not and could
not be the subject of any assessment
proceeding
relating to 1943, for such profits arose only on the
sale. of the shares in 1944.
In Broken Hill Proprietary Company v. !Jroken
Hill Municipal Council (2), the question wa~ one of
the capital value of a mine for rating purposes.
This question of valuation as between the parties
was determined by the High Court of Australia in a
previous year.
But it was held that the decision
did not operate as res judicata. The reason given
was:
"The decision of the High Court related to a
valuation and a liability to a tax in a previous
(I) [1962) Supp. S 8.0.R. 391.
(2) [11126] A.O. 94.
1993
New Jahan:ir Vckil
Alt/ls Co, Ltd.
Bh1vn111ar
••
C1mmissi1n,, •f
Inc.me-t•x, •omb•y
.Nsrth, Kutch f'i StturaJhtra, Ahmeclabtid
196>
,,V1w J~ir Vakil
,\fiJls Co., Lid
Bliat11agor
v.
rommimOfltr of
lrJCme-lox, ButnbaJ
Nerllt, Kutch & Sourahlr•, A.hnudlbd
Da.s ,J.
980
SUPREME COURT REPORTS [1964] VOL. ·
year, and no doubt as regards that year the
<lecision could not be disputed.
The present
case relates to a new question-namely, the
valuation for a different year and the liability
for that year. It is
not eadem questio and
therefore the principle of ·res j111lioota cannot
apply.''
In another decision reported in the same volume,
Hoystead v. Commissioner of 1'11xatio11 (1), one of
the questions was whether {;ertain beneficiaries under
a will were joint owners. It was held that though
in a previous litigation no express decision had been
given whether the beneficiaries were joint owners,
it being assumed and admitted that they were, the
matter so
admitted was so fundamental Lo the
decision then given that it estopped the Commissioner.
The latter decision was distinguished in Society of
Medicfll Officers of Health v. I/ope (').
Both the
decisions were
again considered
by the Judicial
Committee in Cajfoor v. Income
'l'ax Cmmnissioner (8). The decision in
Broken Hill Proprietary
Company's ca.~e ('),was approved and thr. principle
laid down was that in matters of recurring annual
tax a decision on appeal with regard to one year's
assessment is said not to deal with eadem questio
as that which arises in respect of an assessment for
another year and consequently not to set up an
estoppel. As to the decision in Eloyste;;d's case (1), it
was stated :
"Their Lordships arc of opinion that it is impossible for them to treat lloyste,(l{/,'s wse as
constituting a legal authority on the question
of estoppcls in respect of successive years of tax
assessment.
So to treat it would bring it into
direct conflict with
the
contemporaneous
decision in the Broken llill case ; and Lo follow
it would involve preferring a decision, in which
the particular point was either assumed without
(ll (1926] A.C. 1~5.
C2Hl960] A.C. 551.
(S)( 1961) A.O. 584,
(6) (1921) A.C, 9',
. ....
'
•
-
•
' ..
•
'
...
2 S.C.R.
SUPREME COURT REPORTS
981
argument or not noticed to a decision, in itself
consistent with much other authority, in which
the point was explicitly raised and explicitly
determined."
In Instalment Supply (P) Ltd. v. Union of
India (1) this court referred to the decisions just
mentioned and said that it was well settled that in
matters of taxation there would be no question of
res judica~a.
On the principle stated above, it seems to us
that it was open to the taxing authorities to consider
the position of the assessee in 1943 for the purposes
of determining how the gains made in 19H should be
computed, even though the subject of the assessment
proceedings was the computation of the profits made
in 1944. The circumstance that in an earlier assessment relating to 1943 the assessee was treated as an
investor would not in our opinion estop the assessing
authorities from
considering, for the purpose of
computation of the profits of 1944, as to when the
trading activity of the assessee in shares began. The
assessing authorities found that it began in 1943. On
that finding the profits were correctly computed and
the answ~r given by the High Court to the question
. of the computation of the profits was correctly given.
For these reasons the appeal fails and is dismissed with costs.
11i [IQ62J 2 a.c.a. a~.
1963
~New Jahangir Vakil
Mills Ca., Ltd.
Bhav1tagar
v.
Gommissioner of
lncome·tax, Bombay
North, /(utch & 3au·
rashtra, Ahmerlabad
Das J.