2,12,313 less than their book value on the sale of the other assets.
On account of the liquidation of the two companypanies, the assessee companypany became entitled to receive Rs.
DDT Co. and TT Co. went into voluntary liquidation on october 29, 1954.
36,53,453 out of the total distributable assets of TT Co. During the relevant accounting period the assessee received Rs.
1,77,964 representing pre incorporation advances in the case of TT Co. The Appellate Assistant Commissioner rejected all other companytentions of the assessee including the companytention that 60 per cent of the amounts appearing under the head balance of appropriation account in the balance sheets as also the general reserves and liabilities for taxation appearing in the books of the two tea companypanies should be excluded from the companyputation of accumulated profits.
Appeals by Special Leave from the Judgment and order dated the 13th January 1971 of the Calcutta High Court in T. Reference No.
It may also be mentioned that in 1936 the assets of the two companypanies were revalued.
86,11,986 grossed up to Rs.
l0,11,216.
57,69,186 out of the total distributable assets of DDT Co. and Rs.
The amount relating to the land of the tea estate of DDT Co. was Rs.
Land A o 19,30,374, 10,11,216/ Profit Loss Account 16,69,285/ 18,73,125/ General Reserves and liabilities for taxation 3,50,799/ 2,243/ Reserve created on writing up the value of the assets of the ten estates 15,69,828/ 58,772/ The matter relates to the assessment year 1956 57, the companyresponding accounting year for which ended on June 30, 1955.
2,243 Rs.
27,000 being payment on share premium account and included the balance of Rs.
CIVIL APPELLATE JURISDICTION Civil Appeal Nos.
These amounts were carried to the respective reserves of the two companypanies.
On such revaluation the hook value of the assets of DDT Co. appreciated by an amount of Rs.
The Judgment of the Court was delivered by KHANNA, J. This judgment would dispose of two cross civil appeals Nos.
l 5,69,828 and Those of TT Co. by an amount of Rs.
58,772.
For this purpose, those two companypanies owned large tea estates companysisting of land, building, plant and machinery.
DDT Co. realized Rs.
1491/71 for respondent in C.A. 1693/71.
19,30,374 and that relating to TT Co. was Rs.
The assessee s appeal was allowed to that extent.
The assessee companypany held 52,350 shares out of the total issued shares of 54,600 in Dibru Darang Tea Co. Ltd hereinafter referred to as DDT Co. and 22,998 shares out of the total issued shares of 23,000 in Taikrong Tea Co. Ltd. hereinafter referred to as TT Co. DDT Co. and TT Co. were tea companypanies growing, manufacturing and selling tea.
Dibru Darang Taikrong Tea Tea Co. Ltd. Co. Ltd. Rs.
On August 11, 1947 the said tea companypanies sold their entire lea estates, including all the assets, to Brooke Bond Estate India Ltd. As a result of these sales, DDT Co. received a surplus of Rs.
1491 and 1693 of 1971 which have been filed by special leave by the assessee M s Tea Estate India Ltd. and the Commissioner of Income tax West Bengal respectively against the judgment of the Calcutta High Court answering the following question referred to it under section 66 1 of the Indian Income tax Act 1922 hereinafter referred to as the Act partly in favour of the assessee and partly in favour of the revenue Whether on the facts and in the circumstances of the case the balances in the under numbered accounts are includible in the accumulated profits within the meaning of section 2 6A c and if so to what extent?
34,15,500 in all Rs.
1491 and 1693 of 1971.
18,73,125 Rs.
Both the assessee companypany as well as the Commissioner applied to the Tribunal for reference of certain questions arising from the order of the Tribunal to the Court.
Hardayal Hardy, B. B. Ahuja and S. P. Nayar for Respondent in CA1491/71 and for Appellant in 1693/71.
Kay and D. N. Gupta, for the Appellant in CA No.
16,69,285Rs.
192 of 1966.
52,23,786 and Rs.
23,03,363.
The Income tax officer rejected this companytention and allowed only a deduction of Rs.
86,39,286 from the liquidators of DDT Co. and TT Co. respectively.
