Wanchoo, J. - (1.)On behalf of himself and Gajendragadkar J.) In this matter by our order made on 24th April 1958, we had referred the case back to the Tribunal to submit a further statement of case on certain questions. That statement of case has now been drawn up by the Tribunal and sent to this Court. The matter is now ready for decision.
(2.)This is an appeal by the Commissioner of Income-tax, Bombay, against the judgment of the High Court at Bombay given on a reference under S. 66 (2) of the Income-tax Act answering the question referred, in the negative. That question was, "Whether, in any event, on the facts found by the Tribunal, there was any remittance by the petitioner to Bombay within the meaning of and assessable under S. 4 (1) (b) (iii) of the Income-tax Act." The assessment year concerned was 1948-49, the accounting year being 2003 Samvat.
(3.)The facts found may now be stated. At the relevant time, Bhavnagar was a ruling State and therefore outside British India. There was a mill there which we shall, for brevity, call the Bhavnagtar Mills. The assessee and his brother Gordhandas had large sums in deposit with the Bhavnagar Mills, These sums were profits earlier earned by the assessee and his brother in Bhavnagar. The amounts deposited belonged to the assessee and his brother in equal shares. The Bhavnagar Mills kept an account of these deposits. This account showed that on 7th April 1947, a sum of Rs. 50,000 had been paid out to Harkisondas Ratilal and another sum of the same amount of Dilipkumar Trikamlal. There is another mill in Bombay which we shall call the Bombay Mills. The account of the Bombay Mills showed that on 3rd April 1947, Rs. 50,000 had been received from each of Harkisondas Ratilal and Dilipkumar Trikamlal, Harkisondas Ratilal and Dilipkumar Trikamlal were the benamidars for the assessee and his brother and the entries indicated that the moneys had been withdrawn from the Bhavnagar Mills by the assessee and his brother and advanced to the Bombay Mills. The assessee and his brother were in full control of both the Bhavnagar Mills and the Bombay Mills.