INCOME TAX CASE.

Hokitika Guardian, 1 July 1924, Page 3

INCOME TAX CASE.

APPEAL SPCOLEUS. APCKLAN'I), dune 27. Judgment was given by the Chief Justice in the Supreme Court in an appeal by the Colonial Ammunition Company against an assessment for . income by the Commissioner of Taxes touching a transaction in which a largo shareholder purchased the business. 1 -v His Honor said that Major Whitney. * as a shareholder, got control of the business and on March I. 19-1, mitered into an agreement to purchase the business in New Zealand as a going concern its front December 3, 1919. 'Pile consideration was £1(1.730. It was on this transaction that the Commissioner sought to charge income tax. How could if bo said that the Commissioner bad any authority to charge B income t.ux as this was a transfer of | a going concern to the part owner? (k Major Whitney executed a deed o K/' gift in which gilt duty, was paid to

Cecil Arthur Whitney as trustee to hold in trust and form within New ' a company to acquire the said business, called the new company. The Commissioner relied on the bal-ance-sheet of the new company as proof against the old company of the agreement made between Major W hit—ney and itself, and as proof of the vaiue of the property bought. Appellant had no hand in the preparation of tills balance-sheet of the now eom- ' pany. Even if Cecil Whitney prepared this balance-sheet, how did his acts either as the past agent of the old company or ns an officer of the new company hind the appellant company His Honor appeal with costs.