Chennai Court September 1966 Judgments

Commissioner of Income-tax, Madras. Vs. S. Chenniappa Mudaliar ([1967] ...

Court: Chennai

Reported in: [1967]64ITR213(Mad)

VEERASWAMI J. - This is a reference at the instance of the Commissioner of Income-tax under section 66 (1) of the Income-tax Act, 1922, of the following question :'Whether, on the facts and in the circumstances of the case, the two sums of Rs. 72,515 and Rs. 3,14,100 are assessable to tax under section 10 (5A) of the Indian Income-tax Act, 1922 ?'We are concerned with the assessment year 1956-57. The assessee was one of the two managing directors of a private limited company by name Textile Corporation Private Limited. The other managing director was one P. D. Asher. Out of the total of 20 shares or Rs. 100 each, the assessee held nine shares and his son one share, the remaining shares being held by P. D. Asher, his wife and cousin. This company was the managing agent of a public limited company called Asher Textiles Ltd. Both these companies have been incorporated under the provisions of the Indian Companies Act, 1913. The public limited company had issued 11,986 shares of the face va...