CHARENTE STEAMSHIP COMPANY, LTD. v. COMMISSIONERS OF INLAND REVENUE.

(1941) 71 Ll.L.Rep. 137

COURT OF APPEAL.

Before Lord Greene (Master of the Rolls), Lord Justice Luxmoore and Lord Justice DU Parcq.

Revenue - Income tax - Allowances - Replacement of obsolete steamships- Sale of three vessels in one trading year -"In estimating the profits or gains of any trade, manufacture, adventure, or concern in the nature of trade chargeable under this schedule there shall be allowed to be deducted as expenses incurred in any year so much of any amount expended in that year in replacing any plant or machinery which has become obsolete as is equivalent to the cost of the plant or machinery replaced after deducting from that cost the total amount of any allowances which have at any time been made in estimating profits or gains as aforesaid on account of the wear and tear of that plant and machinery, and any sum realised by the sale of that machinery or plant" - Deficiency in case of one sale; surpluses in case of sale of other two vessels-Whether, as Crown contended, regard must be had to net result of all replacements during any one year-Decision of Income Tax Commissioners in favour of Crown - Appeal by shipowners - Income Tax Act, 1918, Schedule D, Cases I and II, rr. 6, 7.