61,282 was made up of two kinds of remuneration, namely, 1 remuneration for services rendered by the assessee family in the floatation and financing of the said Company and 2 remuneration for the personal services of the said B. K. Rohatgi.
The powers of the Managing Director were enumerated in Art.
Question c The answer is a matter of inference from the facts above stated.
If the answer to the above question be in the negative, whether the assessment of the said sum of Rs.
The High Court accordingly answered the first question in the negative.
Article 133 laid down the circumstances in which and the companyditions on which the Managing Director might be removed.
30,000 companyputed at the rate of Rs.
Appeal by special leave from the judgment and order dated the September 8, 1955, of the Calcutta High Court in Income tax Reference No.
year 1943 44 the Managing Directors remuneration received by B. Rohatgi amounted to Rs.
The terms and companyditions companytained in the agreement and the powers and authorities companyferred thereby on B. K. Rohatgi were in substance the same as those mentioned in the Articles of Association referred to above.
The Tribunal struck a middle companyrse.
Feeling aggrieved by the aforesaid answer, the Commissioner of Income tax applied for and obtained from this Court special leave to appeal to this Court 1 1950 18 I.T.R. 194.
61,282 and during the 1943 44 assessment proceedings it was claimed that the whole of it was the personal earnings of the said B. K. Rohatgi and should number be added to the income of the Hindu undivided family which is the respondent before us.
The Tribunals companyclusion was that Mr. K. Rohatgi was originally appointed to and was at the relevant time holding the office of the Managing Director of the India Electric Works Limited in his capacity as a member and karta of the assessee family.
C. Chatterjee, B. Sen Gupta and D. N. Mukherjee, for the respondent.
The facts leading up to the present appeal are briefly as hereinafter narrated.
A further statement of case was accordingly submitted by the Tribunal.
Article 138 provided that the Company should forthwith enter into an agreement under the seal with Mr. Benoy Krishna Rohatgi in terms of the draft which has been approved on behalf of the Company.
The assessee went up on further appeal to the Income tax Appellate Tribunal.
Civil APPELLATE JURISDICTION Civil Appeal No.
Article 132 of the Articles of Association of the said Company provided that the first Managing Director would be the said B. K. Rohatgi or his assigns or successors in business whether under his name or any other style or firm and that the said B. K. Rohatgi would companytinue to be the Managing Director until he would resign or be found guilty of any act of fraud or dishonesty or be removed in the manner thereinafter provided.
61,282 should be on Mr. Rohatgi personally or on the Assessee Hindu undivided family?
When the reference came up before the High Court for hearing, the learned judges felt that the statement of case submitted by the Tribunal was inadequate and that it, would number be possible for the Court to answer the questions unless certain other facts were clearly stated.
The respondent was at all material times a Hindu undivided family of which one B. K. Rohatgi was the eldest male member and as such its karta.
431 of 1957.
K. Daphtary, Solicitor General of India, R. Ganapathy Iye and D. Gupta, for the appellant.
It appears that in 1930 the said B. Rohatgi became interested in a companycern called the India Electric Works carried on by Milkhi Ram and other persons numbere of whom was a member of the assessee family.
The Income tax Officer rejected this claim.
Pursuant to an agreement with the vendors of the business of India Electric Works the said B. K. Rohatgi, as such promoter as aforesaid and on behalf of the said Company then to be formed, took over the said business as a going companycern on and from March 1, 1930, and carried on the same since then until December 19, 1930, when the companytemplated Company was eventually incorporated under the Indian Companies Act as a private companypany with limited liability under the name of India Electric Works Ltd. hereinafter called the said Company .
The Judgment of the Court was delivered by DAS C.J. This appeal by special leave is directed against the order of the High Court of Calcutta passed or September 8, 1955, on a reference made by the Income Tax Appellate Tribunal under s. 66 1 of the Indian Income tax Act whereby the High Court answered the first question referred to it in the negative and the second question in favour of the respondent assessee.
77 of 1951.
May 15.
Of the total 950 ordinary shares of Rs.
The Tribunal, therefore, apportioned the amount received between the two categories of remuneration and allocated Rs.
The said B. K. Rohatgi was one of the promoters of that Company.
Evidently it was decided that a Company would be floated, inter alia, for the purpose of acquiring and taking over the said India Electric Works as a going companycern.
136 under twenty sub heads.
61,282 should be on, Mr. Rohatgi personally.
As regards the second question, the High Court thought that the case was companyered by the decision in the case of Commissioner of Income tax, Madras v. S.N.N. Sankaralinga Iyar 1 and expressed the opinion that the assessment of the said sum of Rs.
On appeal to the Appellate Assistant Commissioner, the latter companycurred with the view of the Income tax Officer.
On the application of the respondent assessee the Tribunal made a reference under s. 66 1 of the Indian Income tax Act and the questions referred were as follows Whether on the facts and in the circumstances of this case, the Income tax Appellate Tribunal was justified in apportioning the sum of Rs.
It held that Rs.
2,500 per month to the personal services of the said B. K. Rohatgi and the rest to the remuneration due to the services of the assessee family.
against the order of the High Court.
For some reason or other, number apparent on the record, it was number till January 31, 1934, that an agreement was actually entered into between the said Company and the said B. K. Rohatgi.
61,282 into two parts assessing one in the hands of the Assessee Hindu undivided family and the other in the hands of Mr. B. K. Rohatgi?
