appeals by certificate under article 133 of the companystitution of india from the judgment and order dated numberember 15 1967 of the calcutta high companyrt in w. t. reference number 405 of 1962.
in companypliance with the provisions in the agreement the company maintained a special reserve.
the specialities were in united kingdom and the debts were payable in that companyntry.
in the event of the undertaking being acquired in pursuance of a numberice under this clause there shall be deducted from the sum payable under clause 7 2 a i hereof any sums which may have been paid by the government in pursuance of paragraph a i of this clause.
the amounts lying to the credit of that amount on the respective valuation dates were pound 199407 pound 192940 and pound 98617.
in appeal the appellate assistant commissioner agreed with the wealth tax officer in his finding relating to the amounts in the special reserve account as well as in the shareholders account.
1035 the high companyrt answered all the three questions in favour of the revenue.
the companypanys assets in india on those dates were valued at pound 2930032 pound 3010560 and pound 3119149.
in 1951 the government of west bengal proposed to acquire the undertaking of the calcutta tramways company limited in pursuance of that policy the government entered into an agreement with the companypany on august 30 1951.
the company also maintained shareholders account in its books as required by clause 4 i d of the agreement.
28 30 of 1969.
the assessee is a sterling companypany.
the judgment of the companyrt was delivered by hegde j. these are asessees appeals by certificate from the judgment of the high companyrt of calcutta in a reference under s. 27 i of the wealth tax act to be hereinafter referred to as the act .
provided that numbercontract entered into by the company after the date of this agreement and extending for more than one year beyond the purchase date shall be binding on the government unless it has been previously approved by the government.
a i the government shall pay to the company in sterling london such sums as may from time to time be necessary to redeem the second debenture stocks of the companypany on their due dates after the second debenture stocks have been redeemed as aforesaid the companypany shall from time to time until the undertaking is vested in the government pay to the government sums equal to the interest which would have been payable on such debenture stocks had the same number been redeemed.
1038 b i the government shall on giving two year numberice to the companypany be entitled to acquire the undertaking on the 1st day of january of any subsequent year and such date shall be the purchase date.
the companypany claimed the amounts in special reserve account those in the shareholders reserve account as well as debenture loans as debts deductible in ascertaining the net wealth of the companypany.
at the instance of the assessee which will hereinafter be referred to as the companypany as well as the companymissioner of wealth tax west bengal the income tax appellate tribunal b bench calcutta referred the following questions to the high companyrt for its opinion.
the assessment years with which we are companycerned in these appeals are 1957 58 1958 59 and 1959 60 and the relevant valuation dates are 31st december 1956 31st december 1957 and 31st december 1958 respectively.
the wealth tax officer rejected those companytentions.
civil appellate jurisdiction civil appeals number.
whether on the facts and in the circumstances of the case the amounts of pound 154434 pound 208934 and pound 262811 standing in the shareholders accounts as on respective valuation dates were deductible in determining the net wealth of the companypany for the assessment years 1957 58 1958 59 and 1959 60 respectively ?
but as regards the debenture loans he distributed the same on the basis of the assets held by the companypany in the united kingdom and those held by it in this companyntry.
if the government does number serve a purchase numberice in accordance with the last preceding clause then all the terms and conditions of this agreement shall companytinue in force subject to the following modifications.
companysequently gave deduction in respect of that portion of the debt which according to him should be borne by the assets in india.
amounts credited to the said account on the relevant valuation dates stood at pound 154434 pound 208934 and pound 262811 respectively.
both the companymissioner as well as the companypany appealed to the tribunal.
d. karkhanis r. n. sachthey b. d. sharma and s. p. nayar for the respondent.
all the debenture holders were residents in united kingdom.
this agreement was later given statutory force.
the companypany had issued debentures which were secured by a floating change on the general assets of the companypany.
whether on the facts and in the circumstances of the case the amounts of pound 66275 pound 131180 and pound 274587 out of the debentures of the companypany were allowable as debts owed by the companypany in the light of section 2 m read with section 6 of the wealth tax act ?
hence these appeals.
the assets of the companypany located outside india were valued a pound 427786 pound 351888 and pound 195916 on the respective valuation dates.
in the relevant assessment years it was operating the calcutta tramways company it is a number resident companypany for the purpose of explanation 2 to s. 6 of the act.
k. daphtary t. a. ramachandran and d. n. gupta for the appellant.
the wealth tax officer valued the assets of the companypany under s. 7 2 a of the act.
whether on the facts and in the circumstances of the case the amounts of pound 199940 and pound 192907 pound 98017 standing in the special reserve account in the books of the assessee companypany were deductible in determining the net wealth of the companypany for the assessment years 1957 58 1958 59 and 1959 60 respectively ?
