AYH v Comptroller of Income Tax

Holding

On an appeal under section 81 of the Income Tax Act, the High Court will not disturb findings of fact by the Income Tax Board of Review unless they are unsupported by the evidence; characterisation of a gain as capital or income remains a mixed question of law and fact closely tied to the trade-or-investment factors.

Facts

The taxpayer, an investment-holding entity, disposed of shares in a Singapore-incorporated company and claimed that the gain was a non-taxable capital gain. The Comptroller assessed the gain as trading income. The Board of Review upheld the Comptroller's assessment, and the taxpayer appealed.

Reasoning

The High Court reviewed the application of the badges-of-trade framework, including frequency of transactions, holding period, financing, and stated objects. The Court reaffirmed that no single badge is determinative; what matters is the overall impression of whether the taxpayer was carrying on a trade. On the facts, the Board's conclusion was open to it on the evidence.