GIRDARDAS AND COMPANY PRIVATE LIMITED Vs. COMMISSIONER OF INCOME TAX
LAWS(GJH)-1963-9-5
HIGH COURT OF GUJARAT
Decided on September 28,1963

GIRDARDAS And CO. (P) LTD. Appellant
VERSUS
COMMISSIONER OF INCOME TAX Respondents

JUDGEMENT

J.M.SHELAT,C.J. - (1.) THIS is a reference under s. 66(1) of the IT Act at the instance of the assessee-company.
(2.) THE relevant assessment year is 1958-59 of which the previous year is the year ending 30th September, 1957. The assessee-company, a private limited company, went into voluntary liquidation on the 23rd of August, 1952. At the time of liquidation, the assessee-company had at its disposal rupees twenty-five lakhs, being its paid-up capital, and Rs. 5,34,041, being the accumulated profits. Prior to the asst. yr. 1958-59, the liquidator had made the following distributions :
(3.) HOWEVER , it was only Rs. 50,500 out of the distribution made during the accounting year ending 30th of September, 1952, relevant to the asst. yr. 1953-54 that the IT Department treated as dividend under s. 2(6A) (c) of the Act, as it then stood, and brought that amount to tax. On the 20th of July, 1957, the liquidator made a further distribution, the distribution being during the asst. yr. 1958-59. The dispute in this reference is regarding the amount of this last distribution, viz., Rs. 75,000, which the ITO, while making the assessment for the tax year 1958- 59, treated as dividend within the meaning of s. 2(6A) (c) of the Act, rejecting the contention of the assessee- company that the said amount could not be regarded as dividend.;


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