HEGDE - (1.) THESE are some of the appeals where the appellant unfortunately had to file two different appeals in respect of the same matter. Civil Appeals Nos. 2350-2353 of 1968 were brought on the strength of the certificates granted by the High Court of Gujarat. No reasons were given in support of those certificates. Hence those certificates must be considered as having not been properly granted. The resulting position was that the appeals brought on the strength of these certificates became unsustainable. To get over that difficulty, the Commissioner of Income-tax, Gujarat invoked our jurisdiction under Article 136 of the Constitution to appeal against the judgement of the High Court. The special leave asked for was granted and thus he came to file Civil Appeals Nos. 1313-1316 of 1971.
(2.) THE assessee is a Private Limited Company and the concerned assessment years are 1957-58, 1959-60, 1960-61 and 1961-62. THE only question for decision in these appeals is whether the assessee company comes within the scope of Section 23-A of the Indian Income-tax Act, 1922 (to be hereinafter referred to as the Act)? The assessee company was incorporated on 11/10/1941. The object clause in the memorandum of association contains the usual string of objects. Confining ourselves to the objects relevant for our present purpose, we get in Clause (3) of the memorandum power "to acquire and hold shares, stocks, debentures, debenture stocks, bonds, obligations and securities issued or guaranteed by any company constituted or carrying on business in British India". Sub-clause (p) of that Clause empowers the company "to take part in the formation, management, supervision or control of the business or operation of any company or undertaking and for that purpose to appoint and remunerate any directors, accountants or other experts or agents". Clause (q) provides power "to carry on all or any of the following businesses: "Agents, Chief agents or licensed agents of any company ... ...." We are not concerned with the other objects mentioned in the memorandum.
(3.) IN July 1942, the assessee company promoted a company known as New INdia INdustries Ltd. By an agreement dated 24/07/1942, the assessee company was appointed as managing agents of the said New INdia INdustries Ltd. IN 1956, the said managing agency was renewed for a period of five years in view of the provisions of the Companies Act, 1956. The group of persons who had floated the assessee company had earlier in the year 1940 floated a company called the Cotton Fabrics Private Ltd. By an agreement dated 22/04/1943, the assessee company was appointed the managing agent of the said Cotton Fabrics Private Ltd. In 1956, the said managing agency agreement was also renewed for a period of five years for the very reason referred to earlier.;