Commissioner of Income Tax vs Putco Private Limited

S.K. Desai, J.—Three questions stand referred to us in this reference. The same are :

"(i) Whether on the facts and in the circumstances of the case, the ship "S. S. Shila Margaret" which the assessee acquired from M/s. Gill Amin Steamship Co. Pvt. Ltd. towards the satisfaction of an amount of Rs. 4 lakhs out of loan of Rs. 4,06,492 outstanding against M/s. Gill Amin Steamship Co. Pvt. Ltd. was stock-in-trade of the assessee ?"

"(ii) Whether, on the facts and in the circumstances of the case, the expenditure of Rs. 14,513 incurred by the assessee on the maintenance of the said ship "S. S. Shila Margaret" during the accounting year relevant to the asst. yr. 1970-71 was an admissible deduction in computing the income of the assessee for the said year ?"

"(iii) Whether on the facts and in the circumstances of the case, the litigation expenses of Rs. 3,000 incurred by the assessee for the acquisition of the said ship "S. S. Shila Margaret" during the accounting period relevant to the asst. yr. 1970-71 was admissible deduction in computing the income of the assessee for the said year ?"

As far as questions (i) and (ii) are concerned, counsel are agreed that the answers to be given to them are concluded in favour of the assessee by decision of this Court in Additional Commissioner of Income Tax, Bombay City-I Vs. Putco Pvt. Ltd., which was a reference involving this very assessee. Counsel is also agreed that answer to be given to question (iii) would also have to be in favour of the assessee particulary in view of the answer given to question (i). Accordingly, the questions referred to us are answered as under :

Question (i) : In the affirmative and in favour of the assessee. Question (ii) : In the affirmative and in favour of the assessee. Question (iii) : In the affirmative and in favour of the assessee.

Parties, however, to bear their own costs of the reference.