COMMISSIONER OF INCOME TAX Vs. VISWANATHA RAO M P

JUDGEMENT

(1.) THE question that has been referred to us is in these terms:

(2.) IT is contended on behalf of the commissioner of Income-tax that there was in this case a release of assets and that the shareholder must be considered to have been paid a sum of Rs. 5750 and to have lent back to the company the same sum as a loan carrying interest at 3 per cent. Therefore, it was contended that there was a distribution of the dividend in the present case. In our opinion, this contention is untenable.