2,58,31,806/ under section 80J. As there were numberprofits to be absorbed, the said amount has been carried forward under section 80J 3 to the succeeding assessment year 1971 72.
But all the same the companypany, as per its books, had made a profit of Rs.
The Board of Directors at their meeting held on March 14, 1973, recommended declaration of a maiden dividend of Rs.
The refusal of their request led to the institution of writ applications by the respondents before the High Court of Andhra Pradesh.
Similarly for the next assessment year 1971 72 it was recorded in the assessment order that the companypany was entitled to deduction of Rs.
Appeals by special leave from the judgment and order dated the 18th September 1974 of the Andhra Pradesh High Court in writ petition Nos.
11,10,176/ being carried forward as unabsorbed losses to the succeeding year and a sum of Rs.
The companypany sought permission of the Income tax Officer number to deduct tax at source out of the dividend payable to the shareholders.
76,65,608/ out of the profits of that year.
According to the High Court the shareholders are entitled to claim deduction under section 80K of the Act and the companypany was entitled to an order of the Income tax officer under section 197 3 for issuing a certificate enabling it number to deduct tax out of the dividend payable to the shareholders.
The said orders disclosed a sum of Rs.
The companypany made business profit of Rs.
Sen, M s. B. B. Ahuja and S. P. Nayar for the appellants.
9,73,93,861/ being carried forward as unabsorbed depreciation to the subsequent year.
The request of the companypany was rejected by the Income tax Officer holding that the shareholders were number entitled to the benefit of section 80K of the Act.
M s. F. N. Kaka, S. N. Talwar, J. B. Ahuja and Shri Narain for the respondents.
The returns filed for the assessment year 1971 72 by the companypany have number been finalised.
6.16 crores resulting in nil total income with some unabsorbed depreciation and business loss to be carried forward to the next assessment year 1974 75.
This amount would be subject to set off against unabsorbed depreciation and business losses which would exceed the said Rs.
The capital employed by the companypany in its new industrial undertaking was Rs.
Madras vs. G. S. Sivan Pillai and others.
M s Coromandel Fertilesers Limited First Respondent is a registered companypany incorporated on October 16, 1961, under the Companies Act and the 2nd Respondent is one of its shareholders holding two hundred equity shares in the paidup capital of the companypany out of a total number of 95,82,010 equity shares issued by it.
The companypany was assessed to income tax as an industrial undertaking for the first time for the assessment year 1969 The orders of assessment were passed on 23 11 1972 and 4 1 1973.
2,44,36,901/ .
It does number appear to be disputed that for the assessment year 1973 74, the companypanys income after deducting depreciation for that year would companye to Rs.
2279 80 of 1973 and 4305 of 1974.
CIVIL APPELLATE JURISDICTION Civil Appeals Nos.
48,87,38,018/ and 6 thereof under section 80J 1 amounted to Rs.
4.55 crores approximately in the accounting year 1972 companyresponding to the assessment year 1973 74.
On companying to know about the declaration of the dividend by the companypany, even the Respondent shareholders had also requested the companypany to obtain the necessary certificate.
2,93,24,281/ .
The Judgment of the Court was delivered by GWSWAMI, J. An important question of law as to the interpretation of section 80K of the Income tax Act, 1961 briefly the Act is raised in these four appeals by special leave.
6.16 crores.
Out of this amount, the amount relating to the ten months of the year companyfined to the period during which the industrial undertaking was in operation was determined by the Income tax Officer at Rs.
969 972 of 1975.
The companypany was engaged in manufacture of fertilisers at its factory at Vishakhapatnam and it companymenced production in December 1967.
As numberprofit was made in the assessment year 1969 70 the aforesaid deficiency within the meaning of section 80J 3 was carried forward to the succeeding year 1970 71.
It is number disputed that after setting off the brought forward allowances the companypany will number be assessable to any income tax upto the assessment year 1973 74.
4.55 crores in the year 1972.
The companypany represented to the Income tax Officer on March 3, 1973, seeking a certificate under section 197 3 of the Act pointing out that the dividend payable by it would qualify for deduction in the hands of the shareholders under section 80K of the Act.,
