COMMISSIONER OF INCOME-TAX U.P. LUCKNOW vs THE MAHESHWARI DEVI JUTE MILLS LTD. KANPUR

The Supreme Court held that the receipts from the sale of 'loom-hours' by the respondent-assessee were capital receipts and not taxable under income tax. The Court distinguished between capital and revenue receipts, affirming that the sale of fixed capital assets does not constitute taxable income. The High Court's decision was upheld, reversing the Income-tax Officer's inclusion of the receipts in the taxable income of the assessee, as the transaction was deemed a sale of an asset rather than a trading receipt.