Deb, J. - (1.) The Income-tax Appellate Tribunal has referred, under Section 66(1) of the Indian Income-tax Act, 1922, the following question of law: "Whether, on the facts and in the circumstances of the case, the factory at Cossipore can be said to have been formed by the reconstruction of business already in existence or by the transfer to it of machinery and plant previously used in any other business so as to fall within the scope of Section 15C(2)(i) of the Indian Income-tax Act, 1922."
(2.) In this reference we are concerned with the assessment years 1957-58 to 1961-62. The relevant year ended on 31st October, preceding the relevant assessment years. The assessee was incorporated as a public limited company on June 12, 1945. In the same year it took on lease a factory situated at Hazra Road and started manufacturing switch boards, transformers, etc., and thereafter purchased the said factory in the year 3946 and continued to carry on business therein.
(3.) In 1956 the assessee started a new factory at Cossipore by purchasing new machinery and plant of the value of over Rs. 6 lakhs and started manufacturing therein the same types of goods as were being manufactured in the factory at Hazra Road. Those two factories were run simultaneously by the assessee for three months and in 1957 the assessee closed down the factory at Hazra Road. Thereafter, the assessee purchased machinery from time to time and installed them at Cossipore factory and the cost of such installations came to about Rs. 39 lakhs on October 31, 1960. As the assessee did not produce proper materials before the Tribunal it was presumed by the Tribunal that the factory at Hazra Road was dismantled by the assessee and its machinery were used at Cossipore factory.;