On of the taxpayers ("Nitralloy"), which was a subsidiary of holding company ("Thos. Firth") which carried on a steel manufacturing business through other wholly-owned subsidiaries of Thos. Firth, was found not to have acquired a part of the undertaking of Thos. Firth for purposes of s. 55 of the Finance Act 1927 (UK) when Thos. Firth transferred minority shareholdings in two companies ("British Acheson" and "High Speed") to it in consideration for treasury shares. After referring to a submission of taxpayer's counsel that "if a company's undertaking is the totality of its assets, any part of its assets must be a part of its undertaking," Plowman J stated (at pp. 1353-4):
I am unable to accept that argument. The word "undertaking," in my judgment, denotes the business or enterprise undertaken by a company, and while Thos. Firth's holdings of British Acheson and High Speed shares were no doubt acquired in the course of Thos. Firth's business, they were not, in my judgment, a part of that business. A greengrocer's business is not doubt to sell fruit, but the pound of apples which you can buy can hardly be described as a purchase of part of the greengrocer's business.