JUDGMENT - (1) The assessee is a Hindu undivided family. Ir carries on business as a wholesale dealer in cloth in two names (1) Manilal Dayabhai, Vithalwadi, Bombay, and (2) Dayabhai sobharam, Champa Galli, Bombay. The business with the up-country merchants is carried on in the name Manilal Dayabhai, and the local business is carried on the name of dayabhai sobharam. The assessee also carries on business in speculation in gold, silver, cotton, etc. Two separate sets of books of account are maintained by the assessee in respect of the business carried on in the two names. We are in this reference concerned with the business which is carried on by the assessee in the name of Dayabhai Sobharam. For the Assessment year 1949-50 the assessee retuned a total income of Rs. 1,38,946/- from the business done in the name of Dayabhai sobharam. In arriving at that figure the assessee deducted from the gross income an amount of Rs. 1,04,042/- as loss suffered in the speculation business in shares cotton, gol, silver and other commodities. In the assessment years 1947-48 and 1948-49 the assessee had suffered losses in speculation in gold, silver, cotton and shares as also in seeds, hessian and linseed. The assessee claimed that against the profit made by it in the cloth business in the year of assessment 1949-50 should ;be set off the losses suffered in the speculation business which were brought forward from the preceding year. It was claimed by the assessee that the cloth business and the business in speculation in gold, silver, cotton, shares, hessian and linseed constituted the same business. The income-tax authorities negatived the contention raised by the assessee. The assessment proceedings were brought before the Income-tax Appellate Tribunal, and Mr. Aggarwal the Judicial Member and Mr. Malhotra the Accountant Member, constituting the Tribunal, disagreed in their conclusion on that question raised before them. Mr. Aggarwal was of the view that the speculation business and the cloth business constituted the same business within the meaning of section 24(2) of the Income-tax Act. He observed:

"Taking all the facts and circumstances into consideration I am firmly of the opinion that the speculation business carried on by the assessee is the same business within the meaning of section 24(2) of the Indian Income-tax Act and the Loss carried forward must be adjusted against the assessees profit under the head profits and gains of business, profession or vovation."

In Mr. Malhotras view, the speculation business carried on by the assessee had no concern with the normal cloth business conducted by it. In view of the difference of opinion between the two members the matter was referred to the President of the Tribunal who agreed with the conclusion of Mr. Malhotra. He held that the assessee had failed to prove that the speculation business carried on by it was the same business as the business in cloth, and observed that, if a finding was necessary, in his view the cloth business and the speculation business were "not one and the same business in spite of the trivial connection pointed out by the assessee". We may point out that whereas the two members of the Tribunal expressed their respective opinions on the question whether the cloth buiness and the business in speculation carried on by the assessee could be regarded as one and the same business, the President decided the appeal primarily on the view that the burden lay upon the assessee to establish that the speculation business was the same business as the cloth business carried on by it and that burdedn was not discharged by the assessee, and observed that if it was necessary for him to express an opinion he would agree with the view taken by Mr. Malhotra.

(2) In this reference Mr. Kolah for the assessee has strenuously contended that all the usual indicia which are regarded as determinative of "same business" within the meaning of section 24(2) of the Income-tax Act are found Present in

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