RAMAPRASADA RAO J.

The assessee is a doctor and a leading surgeon who is practising his profession at Madurai and also maintaining and running a nursing home. In the year of account he installed a combination sterilizer at a cost of Rs. 16, 090 and an equipment called the major surgical luminaire at a cost of Rs. 8, 065. These new items of plant were wholly utilised by the assessee for the activities indulged in by him. He claimed development rebate under section 10(2) (vib) of the Indian Income-tax Act, 1922, in respect of the above plant. He was unsuccessful before the revenue. The Tribunal on second appeal found that the assessee was running a nursing home as part of his profession and could not therefore classify his income under the head "Income from business", held it was income from his profession, and disallowed the claim for development rebate. On the assessee requiring the Tribunal to refer the question of law arising out of its order, the following question has been referred to us to render our opinion thereat

"Whether, on the facts and in the circumstances of the case, the Tribunal was right in holding that the assessee was not entitled to claim development rebate of Rs. 6, 380 under section 10(2) (vib) of the Income-tax Act, 1922 ?" *

The problem confronting us is indeed a nice one, at once interesting and attractive. No doubt, the learned professions of medicine, law and theology enfold into their conclave only members who practise such professions as a vocation and not as a trade. But in these days of advanced science and ebullient developments commensurate with the need of the community, society and country, a centrifuged activity, though related to a profession as such, may not in a given case be interpreted as a wooden exercise thereof, if other compelling and surrounding circumstances need an expansive understanding of it in a commercial way. An expert professionalist, if he has the inclination, capacity and zeal to expand his activities may do so. As a result thereof he might tread into the arena of business activity. Such a composite activity is conceivable and indeed is plausible in modern days. No doubt, no decisive test can be laid down but the multitude of incidents haloing the same might reflect on the true nature of the vocation. If, therefore, an expert equips himself, as in this case, with plant and machinery with which he, with the aid of hisprofessional skill and in collaboration with qualified assistants, is able to turn out an activity which is not strictly a professional activity but savours of a commercial activity as well, is it to be understood still that he is mechanically exercising his profession. We think not. Any kind of commercial activity telescoped to professional activity ought to be understood as a business, as is properly understood. In such circumstances it may be that the business aspect of the activity springs from the professional activity of the person concerned and is irretrievably connected with it. Nevertheless, if it is said that if there is an organic and composite activity and if there is a merger of professional skill with trading or business, the poser to be answered is whether the combined endeavour results in emoluments which, though not strictly terniable as profits, are really gains in the shape of profits. If the answer is in the affirmative, it is a business as it is the outcome of combined efforts. As Chagla C. J. said in Commissioner of Income-tax v. Sir Homi Mehta's Executors

"....... in trying to determine whether a certain transaction resulted in profits, we must come to a conclusion that the transaction resulted in real profit, profits which from the commercial point of view meant a gain to the person who entered into the transaction, not profits from any narrow, technical or legalistic point of view." *

Apart from this, if an assessee, who is a professional and an expert, contemporaneously carries on a trade which is annexed to the exercise of