Law:

Section:

Section 251 of the Income-tax Act, 1961 [Corresponding to section 31 of the Indian Income-tax Act, 1922] - Commissioner (Appeals) - Powers of - Assessment year 1944-45 - Whether power which AAC could exercise in disposing of an appeal whether received by him after remand or directly against order of ITO is one conferred upon him by section 31 of 1922 Act, and it was not subject to any restrictions arising out of subject-matter of appeal - Held, yes - Whether AAC is empowered in disposing of an appeal against an order of assessment either to confirm order, to reduce, enhance or annual assessment - Held, yes - Whether, however, it would not be open to AAC to introduce into assessment new sources and his power of enhancement is restricted to income which was subject matter of consideration for purpose of assessment by ITO - Held, yes Section 2(13) of the Income-tax Act, 1961 [Corresponding to section 2(4) of the Indian Income-tax Act, 1922] - Adventure in nature of trade - Assessment year 1944-45 - Whether if a person buys land with no intention of selling it and after a long interval finds it convenient to sell land by parcelling it out into different plots and also by laying out roads and providing other amenities with a view to get more price, it cannot be said that the activity which he carried on has any element of trade, commerce or business and it cannot be said, therefore, that it is an activity in nature of a trade - Held, yes Words and phrases: Word "business" as occurring in section 2(4) of the Indian Income-tax Act, 1922 FACTS The assessee-company purchased in 1932 a ginning factory with extensive lands appurtenant to the factory and also a plot which was somewhat removed from the factory and was in the heart of the town. Before the termination of the accounting year 1942, the building, the machinery and the factory were sold together with some of the land appurtenant to it. The profit which accrued from out of that transaction was subjected to income-tax without objection during the assessment year 1942-43. Out of the vacant site of 7 acres, two acres were reserved by the assessee for erecting a cinema theatre, and the remaining 5 acres of land was…

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