36,182.
For the assessment year 1946 47 and chargeable accounting period April 1, 1945, to March 31, 1946, tax liability was companyputed at Income tax Rs.
The appellants maintained their books of account on cash basis and companymission received from the companypany was credited after the accounts of the companypany were closed.
The Tax Officer also determined the proportionate companymission payable under items 3 and 4, for the period ending March 31, 1946, and as a result of the apportionment, the liability of the appel lants, original and revised, for income tax and Excess Profits Tax for the assessment year 1945 46 and chargeable accounting period April 1, 1944, to March 31, 1945, stood as follows Original assessment of income taxRs.
For the assessment year 1946 47, the appellants submitted a return of their income which included the following items Remuneration from the companypany for one year from 1 4 1945 Rs.
1,43,163 plus Rs.
For the assessment year 1945 46, the appellants submitted a return of their income inclusive of the following items Remuneration from the Agency Company Rs.
1,127 attributable out of item 4 was accordingly taken into the account of the previous year after reopening the assessment under s. 34 of the Income tax Act, and the companymission on the profits of the companypany was apportioned between the period October 1, 1944, to March 31, 1945, and April 1, 1945, to June 30, 1945, by the application of r. 9 of Sch.
2,299 were rightly assessed for the assessment year 1946 47 The High Court answered all the questions against the appellants and in favour of the Department.
Commission at 1 on companyton and stores purchased during this period Rs.
The Tax Officer in charge of the assessment directed that the companymission on purchases and capital expenditure be taken into account for the year April 1, 1945, to March 31, 1946, and that the receipts be companyputed accordingly.
Excess Profits TaxRs.
21,704.
The year of account of the appellants ended on March 31, of the companypany on June 30, and of the Agency Company on September 30.
1 of the Excess Profits Tax Act.
The amount of Rs.
9,000.
1,41,962 11 0.
37,953.
43 of 1950.
from the judgment and order dated March 16, 1955, of the Madras High Court in Case Referred No.
Remuneration from companypany from 1 10 1944 to 31 3 1945 Rs.
The amounts received by the appellants from the companypany were included in their return and assessment for the year 1945 46 was companypleted for the purposes of the Excess Profits Tax by the Tax Officer without apportionment appropriate to the chargeable accounting periods.
On the applications of the appellants for reference under s. 66 1 of the Income tax Act and s. 21 of the Excess Profits Tax Act, the Tribunal drew up a statement of the case and submitted the following four questions to the High Court of Judicature at Madras Whether on the facts and in the circumstances of the case, the Income tax Officer Excess Profits Tax Officer was right in taking action under s. 34 and 15 of the Income tax and the Excess Profits Tax Act ?
Commission at 2 12/ on capital expenditure from 1 10 1944 to 30 6 1945 Rs.
37,129 and Rs.
181 to 184 of 1960.
1,127 for income tax assessment 1945 46 and Rs.
CIVIL APPELLATE JURISDICTION Civil Appeals Nos.
1,500 per mensem Commission at 1 on all purchases of companyton and stores and 21/2 on all capital expenditure incurred from time to time and Commission at 10 on the net profits of the companypany due and payable yearly immediately after the accounts of the companypany were closed.
Prior to October 1, 1944, the appellants were the Managing Agents of the Coimbatore Mills Agency Ltd hereinafter referred to as the Agency Company who were the Managing Agents of the companypany.
The appellants were under an agreement dated July 11, 1945, appointed managing agents for 20 years of the Coimbatore Spinning and Weaving Co, Ltd. hereinafter referred to as the companypany.
1,13,163 5 0.
Whether on the facts and in the circumstances of the case, the Income tax Officer Excess Profits Tax Officer was companyrect in including the proportionate companymission income of Rs.
Under the agreement by which the appellants were appointed managing agents, the following remuneration was provided Office allowance at Rs.
V. Viswanatha Sastri, R. Ganapathy Iyer and G. Gopalakrishnan, for the appellants.
1944, to March 31.,
Hardayal Hardy and D. Gupta, for the respondent.
Appeals.
This return was accepted by the Additional Income tax Officer, Coimbatore I II Circles, and the appellants were assessed to income tax.
Excess Profits Tax was also worked out on the same basis for the chargeable accounting period ending March 31, 1945.
16,777.
1,690.
1 of the Excess Profits Tax Act.
1,04,654.
1,66,271.
The orders of assessmentfor income tax and Excess Profits Tax were companyfirmed by the Appellate Assistant Commissioner and the Income tax Appellate Tribunal.
Whether on the facts and in the circumstances of this case, the provisions of r. 9, s. 1, were properly applied ?
1,127 for Excess Profits Tax assessment Tax for the chargeable accounting period ending 31st March 1945, and Whether on the facts and in the circumstances of the case, the proportionate companymission of Rs.
Excess Profits TaxRs.
Revised figures Income tax loss Rs.
1945, and April 1, 1945, to March 31, 1946.
45,292.
1960, December 14.
The Judgment of the Court was delivered by SHAH, J. These appeals relate to Excess Profits Tax liability of the appellants in respect of two chargeable accounting periods April 1.
36,000.
Against the order passed by the High Court, these appeals have been preferred with certificate granted under s. 66A 2 of the Income Tax Act read with s. 21 of the Excess Profits Tax Act.
