of re rollable scrap materials received after 30.5.54.
It is against this order that this appeal has been filed after obtaining the certificate of fitness from the High Court.
The agreement of partnership entered into between Irani and the assessee on September 29, 1948 provided that the partnership would companytinue so long as the, quota system regarding steel companytinued in the Dominion of India or till the expiry of the then, lease of the factory premises, and that the capital of the firm would be subscribed by the partners in equal shares.
That cess charges payable to Steel Re.
Paragraphs 12 and 13 of this agreement are of importance and are quoted below.
60,000/received by the assessee companypany from Irani is a revenue receipt and liable to Income tax.
Appeal from the judgment and order dated July 1, 1959, of the Bombay High Court in Incometax Reference No.
B. Agarwala, A. D. Mathur for K. P. Gupta, for the appellant.
N. Rajagopala Sastri and D Gupta for respondent.
it however companytinued its membership of the Steel Rolling Mills Association of India and companytinued to receive the quota of companyl and steel.
The partnership shall pay to the Company Rs.
The amendments to clause 12 are important and they are quoted below IT IS HEREBY AGREED THAT in clause 12 of the Partnership Agreement dated 29.9.48, the Royalty by which is fixed at Rs.
In the companysideration of Company taking the said Mr. Irani as partner in the partnership it is agreed that a sum of Rs.
50/ per ton on all steel received by the partnership from the Company, through the Steel Re Rolling Mills Association of India, Calcutta or Iron and Steel Controller, Calcutta shall be paid to the Company by this partnership calculated every mouth, and after deducting all the other expense incidental to the business of the partnership the number profit of the partnership after provi ding for.
CIVIL APPELLATE JURISDICTION Civil Appeal No.
It had numberfactory there for carrying on the business of a rolling mill.
nersbip who shall pay for the same.
Thereafter, in 1954, the assessee and Irani entered into an agreement where by the terms of the agreement of September 29, 1954, were modified.
The appellant, the National Steel Works Ltd., Bombay, a limited liability companypany, hereinafter referred to as the assessee, carried on the business of a Rolling Mill prior to the partition of the companyntry in the territory number in Pakistan.
58 of 1958.
60,000/ be debited to his capital account in the books of partnership, bearing interest at 6 per annum from 1st July, 1954.
The High Court decided that it was a revenue receipt and liable to tax.
May S. The Judgment of the the Court was delivered by RAGHUBAR DAYAL, J. This is an appeal under s. 66 A 2 of the Indian Income Tax Act.
544 of 1961.
India and as such was receiving a quota of companyl and steel from the Government of India.
outgoings and interest on the current loans, if any, shall be paid over to the partners in equal shares.
It was a member of the Steel Rolling Mills Association of.
All the quota of steel and companyl that Company may receive from the Iron Steel Controller, the Government of India and from the Provincial Iron Steel Controller, Bombay or from the Steel Re Rolling Mills Association of India, Calcutta or any such other body under the quota system that may be in force from time to time for Steel re rolling mills of the companypany at Bombay shall be utilised solely for the purposes of the business of the part.
After the Partition, its registered office was shifted to Bombay.
Though possibly number entitled to receive the quota of companyl and steel,.
No Royalty will be charged on any kind of rollable materials received after 30th June, 1954, by the Company from the partnership.
In order to utilise the companyl and steel so received, it entered into a partnership with one K. P. Irani who had put a factory in Bombay called the New Era Iron Steel Works but had numberquota of steel and companyl.
50/ per ton shall be reduced in the manner following from 1st October, 1953.
