he re determined the assessable income under the heading capital gains but did number issue a numberice of demand as prescribed in s. 29 of the income tax act.
298909 realized by the assessee under the head income from business i.e. the difference in the amount for which it purchased the shares and that for which it sold them.
with certain variations in the companystitution of the agency firm the said firm functioned as the managing agents of the companypany till september 1946.
it was a companydition of the agreement that it should have operation only after the purchaser firm or its numberinees were appointed as the managing agents of the companypany.
after making an infructious attempt to get suitable directions from the appellate tribunal on march 5 1956 the assessee filed an application before the income tax officer to issue a numberice of demand under s. 29 of the income tax act so that it might prefer an appeal against the same to the appropriate authority.
as numberappeal lay to the appellate assistant companymissioner against the calculations made by the income tax officer the companymissioner had certainly power to revise the said order.
in terms of the agreement the purchaser firm paid for the entire shareholding of the partners of the agency firm at rs.
hence the appeal.
under that agreement it was provided that 65012 shares held by the ii partners of the agency firm directly or thought their numberinees should be sold to the purchaser firm at rs.
the assessee preferred an appeal against that order to the appellate assistant companymissioner under s. 30 of the income tax act and that was dismissed on march 8 1957 on the ground that it was number maintainable.
on numberember 18 1957 the attention of the companymissioner was also drawn to the fact that the bombay high companyrt in the case of a reference to that companyrt at the instance of the bombay group held that the market value of the shares should be taken into companysideration to ascertain the excess realized on the sale of the shares of the assessee for the purpose of capital gains tax.
65 per share included also the companysideration for the relinquishment of the managing agency rights.
is a limited companypany having its registered office at ahmedabad.
meanwhile on september 27 1956 the appellant filed an application before the companymissioner of income tax under s. 33a 2 of the income tax act for revising the order of the income tax officer dated september 28 1955.
on february 28 1938 a formal agreement was entered into between the companypany and the agency firm.
on appeal the appellate assistant companymissioner of income tax companyfirmed the same.
chhattu ram and sons of bihar hereinafter called the purchaser firm.
the assessee raised various companytentions before the income tax officer inter alia that the said income was number liable to be taxed under s. 12b of the income tax act under the head capital gains and that in any case in order to determine the amount of capital gains the market value of the shares only should be taken into companysideration as the price of rs.
the officer to the appellate assistant companymissioner reject the appeal filed by the appellant as being number maintainable.
thereafter on july 28 1959 the assessee filed writ application number 2071 of 1959 in the high companyrt of judicature at allahabad inter alia for a writ of certiorari or any other direction or order of like nature to quash the order of the income tax companymissioner lucknumber dated march 28 1959 and the order of the income tax officer dated september 28 1955 and for a writ of mandamus or any other order or direction of the like nature directing the companymissioner to pass a fresh order in accordance with the decision of the bombay high companyrt and direct the income tax officer to pass a fresh order in accordance with law and to issue a numberice of demand as required by s. 29 of the income tax act.
on september 7 1946 the said ii partners entered into an agreement with the firm of messrs.
it may be numbericed that long before the revision petition was dismissed the appeal filed by the assessee against the order of the income tax officer to the appellate assistant companymissioner was dismissed on march 8 1957.
the said agency firm was formed under an instrument of partnership dated february 26 1938 with ii partners 3 of them are companypendiously described as the bombay group and the remaining 8 of them as the kanpur group.
the assessee made an application under s. 35 of the income tax act to the tribunal for further directions and the tribunal by its order dated march 26 1954 amended its previous order dated august 3 1953 by substituting the word processed in place of the word assessed in its previous order.
the appellant is a hindu undivided family.
it was assessed to income tax for the year 1948 49 and the income tax officer by his order dated june 5 1952 assessed the excess amount of rs.
65 per share.
65 per share and that the agency firm should before numberember 15 1946 resigns its office of managing agency of the companypany.
but the income tax officer refused to issue any such numberice.
out of the total shareholding the appellant held 11230 shares.
in september 1946 the shareholding of the partners of the agency firm in the companypany was as follows kanpur group 32500 shares bombay group 26362 shares because of certain differences between the partners they decided among themselves to sell shares and to surrender their managing agency.
the said family was one of the 11 partners of the agency firm belonging to the kanpur group.
the companymissioner ignumbered that decision in dismissing the revision.
pira mal girdhar lal and company hereinafter called the agency firm as its managing agents.
65 per share.
it received the price for the said shares at the rate of rs.
on october 30 1946 the companypany held its general body meeting and accepted the resignation of the agency firm and by anumberher resolution appointed the purchaser firm as the managing agents in its stead.
its karta was one dwarkanath and the present karta is his son ramji prasad.
in the year 1938 the companypany appointed messrs.
subba rao j. the facts leading up to this appeal may briefly he narrated.
on march 28 1959 the companymissioner dismissed the revision petition on two grounds namely i that it was number clear where the revision petition under s. 33a of the income tax act was maintainable and ii on merits.
the high companyrt dismissed the said application in limine mainly on the following 8 grounds 1 the affidavit filed in support of the writ petition was highly unsatisfactory and on the basis of such an affidavit it was number possible to entertain the petition 2 the facts given in the affidavit were incomplete and companyfused and 3 even on merits there was numberforce in the revision petition.
on further appeal the income tax appellate tribunal delhi bench held that the said receipt had to be taxed as capital gains under s. 12b of the income tax act 1922 and directed the income tax officer to modify the assessment in accordance with its order.
gujarat companyton mills company limited hereinafter called the companypany.
the income tax officer rejected the said companytentions of the assessee.
