- (1.) THIS is a reference by the Income-tax Appellate Tribunal, Bombay, under Section 66 (1), income-tax Act.
(2.) THE reference first came before this Court on 30-10-1952. Learned counsel for both parties then stated that they were agreed that the Statement of the Case was wholly insufficient to enable the Court to answer the important question of law, raised in the reference and they gave the court detailed notes on the facts which they wanted to be mentioned in the reference and the papers which they wished to be included in the paper-book. Copies of those notes were sent to the Income-tax Appellate Tribunal which was directed to make a fuller statement of the case and send it to this Court. The Tribunal was further permitted to re-frame the questions upon which the opinion of the Court was sought and take such further evidence as might be necessary. A fresh Statement of the Case was accordingly prepared but again it was found that the Tribunal had not given a finding on all the necessary facts. Consequently on 2-3-1954, the case was again sent back to the Income-tax Appellate Tribunal to record a finding on certain specific questions which were set out in that order. A third statement of the Case has now been received from the tribunal, giving findings on those questions. In dealing with the reference, we have taken into account all the three Statements of the Case received from the Tribunal.
(3.) THE assessee is the Swadeshi Bima Company, Ltd. , Agra, which was incorporated as a public limited company on 11-4-1931, and which commenced business on 16-6-1931. The purposes for which the company was incorporated are set out in the Memorandum of Association, the more important clauses of which read as follows : "1. To carry on in India including Indian States and any part of the world, all kinds of insurance and all kinds of guarantee and indemnity business and in particular without prejudice to the generality of the foregoing words. 2. To carry on the business of life assurance in all its branches, sickness assurance, accident assurance, and annuity business in all its various forms, either alone or in combination with any other or others either with or without the right of participating in the profits of the Company including the whole life and short period life assurance, endowment assurance, loss of health assurance, joint life and survival assurance, against sickness or accident alone or in combination, with life assurance the purchase of reversions and contingent life interests, and the purchase and sale and repurchase of annuities of all kinds, including the immediate, deferred permanent, joint life or survival annuities, and to make or grant assurance for payment of money by way of single payment or several payments. or by way of immediate and deferred annuities or otherwise on the happening of any contingency whatsoever; and generally to transact the business of Life assurance Company, which may be in any way connected with or dependent on the contingencies of human life; and which may be undertaken and transacted according to Law. 3. To reinsure with other Insurance Companies, doing similar business all or any of the risk, taken by the Company, and to undertake any authorised risk from similar companies either direct or by way of re-insurance. 4. To carry on the business of Insurance on Pension Fund basis, i. e. , to pay policy-holder or his dependents in way of monthly pension, instead of lump sum when the policy matures. 5. To invest the funds of the Company in any movable and immovable property, government securities, municipal debentures, co-operative societies, banks, shares of industrial companies or shares of Commercial concerns, debentures of commercial and manufacturing concerns or limited concerns or loans to the individuals. 9. To purchase, take on lease, hire or otherwise acquire any estate or interest in any lands, buildings, easements, rights, privileges, concessions or immovable property of any kind and tenure, necessary or convenient for the business of the Company in any part of the world. 10. To sell, exchange, lease, mortgage, or otherwise to make deed for any part of the Company's property or to construct, alter, maintain buildings work; machinery, necessary or convenient for the business of the Company. 14. To purchase or otherwise acquire, all or any part of the business and property, of any person, firm or Company carrying on any business, which this Company is authorised to carry on and to take over the assets or property, and liability of such persons firm or Company, on such terms as the Company may think fit. 16. To borrow, sell, exchange, lease, mortgage all or any of the movable or immovable property, present or future including Capital and to issue debenture or debenture stock, perpetual or otherwise, with or without a specific charge on all or any part of the Company's property. 18. To enter into working arrangements of all kinds, for sharing profits, co-operation, joint adventure, reciprocal conversion or otherwise with any other Company or Companies, Corporation firms or persons carrying on or about to carry on business which this Company is authorised to carry on or engaged in carrying on. 24. To act as loan and Estates Agents and to negotiate Loans for State, Estate and against other movable or immovable securities or Towns Municipalities, Port Trust etc. 25. To carry on the business of a loan Company in all its branches. 28. To undertake the sale of Swadeshi or foreign manufactures on commission or any other basis. ";