COMMISSIONER OF INCOME-TAX Vs. AHMEDABAD ADVANCE MILLS LTD

JUDGEMENT

(1.) THE respondents, who carry on the business of cotton spinners and weavers in British India, are the owners of certain sterling bonds of the Government of India, the interest on which is payable in England.

(2.) IN the year ending March 31, 1936, interest on such bonds was paid in sterling in England to certain agents of the respondents, the amount of such interest expressed in rupees being Rs. 18,333. This sum was expended by such agents in the purchase in England on behalf of the respondents of certain mill stores and machinery which were then sent to the respondents in British INdia and there used by them for the purposes of their business.

(3.) THE respondents in due course appealed to the Assistant Commissioner against the assessment in respect of the Rs. 18,333, but he dismissed the appeal and confirmed the assessment.