Appeal from the judgment and order dated March 6, 1961 of the Punjab High Court Circuit Bench at Delhi in I.T.R. No.
The High Court therefore proceeded to deal with the question on the footing that it was, by the question referred, called upon to interpret article 74 of the Articles of Association of Govan Bros. It is companymon ground between the appellant and the Revenue that the provisions of the Companies Act of the former Rampur State were in terms identical with the provisions of the Indian Companies Act, 1913.
The Commissioner of Income tax says that the directors of Govan Bros. had paid by warrant issued on December 28, 1950 pursuant to a resolution dated August 30, 1950, interim dividend and it was only on payment the dividend became taxable under s. 16 2 of the Indian Income tax Act.
4,12,500/being interim dividend in respect of its shareholding in Govan Bros. This amount was brought to tax with the other income of the appellant in the assessment year 1952 53 by the Revenue authorities.
Pursuant to a resolution passed by the board of directors of M s Govan Bros. Rampur Ltd. hereinafter called Govan Bros. at a meeting held on August 30, 1950, the appellant received a dividend warrant dated December 28, 1950 for Rs.
CIVIL APPELLATE JURISDICTION Civil Appeal No.
Even though the question was framed a , if article 95 of the First Schedule to the Indian Companies Act, 1913, ap plies to Govan Bros, it is companymon ground that the companypany was registered under the Companies Act of the former Rampur State, and it had adopted special Articles of Association in supersession of Table A of the Companies Act.
April 1, 1964.
At the instance of the appellant the Appellate Tribunal drew up a statement of the case and referred the question set out hereinbelow to the High Court of Punjab under s. 66 1 of the Indian Income tax Act Whether on a true interpretation of Article 95 of the First Schedule to the Indian Companies Act, 1913, the dividend of Rs.
K. Daphtary, Attorney General, K. N. Rajagopal Sastri and R. N. Sachthey, for the respondent.
SHAH, J. The appellant which is a Hindu undivided family was the registered holder of 1,500 shares of M s Govan Bros. Rampur Ltd. in the year of account October 1, 1950 to September 30, 1951.
505 of 1963.
Against the order of the High Court, this appeal is preferred by the appellant with certificate granted by the High Court.
K. Kapur and B. P. Maheshwari, for the appellant.
after rejecting the objection of the appellant that it represented income for the assessment year 1951 52.
The High Court recorded an answer to the question in the affirmative.
The judgment of the Court was delivered by.
4,12,500/ was liable to be included in the assessment year 1952 53.
The relevant articles of Govan Bros. dealing with declaration or payment of final and interim dividends were articles 73 and 74.
16 of 1959.
The appellant companytend that the directors of Govan Bros. had in exercise of authority expressly companyferred upon them by article 74 declared dividend in their meeting dated August 30, 1950 and on such declaration the dividend became a debt due to the appellant and under the Indian Income tax Act it became taxable in the year of assessment 1951 52, for the previous year of the appellant had ended on September 30, 1951.
