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PETITIONER: COMMISSIONER OF INCOME-TAX,BOMBAY CITY
Vs.
RESPONDENT: THE CENTURY SPINNING AND MANUFACTURING CO. LTD.THE CENTURY
DATE OF JUDGMENT: 08/10/1953
BENCH: HASAN, GHULAM BENCH: HASAN, GHULAM SASTRI, M. PATANJALI (CJ) DAS, SUDHI RANJAN BOSE, VIVIAN BHAGWATI, NATWARLAL H.
CITATION: 1953 AIR 501 1954 SCR 203 CITATOR INFO : R 1961 SC 812 (5,11) RF 1966 SC1393 (13,16,23) R 1981 SC2105 (8,26,37,40,41,43,46)
ACT: Business Profits Tax Act (XXI of 1947), Sch. II, rr. 2 and 3--Determination of capital of company-Inclusion of ‘reserves’-- Accumulated profit carried over to next year without declaring it as reserve-Whether ’reserve’-Indian Companies Act (VII of 1913), ss. 131-A, 132, Sch. I, Table A, Reg. 99.
HEADNOTE: The balance sheet of a company for the calendar year 1945 showed a profit of Rs. 90,44,677, subject to the provision for depreciation and taxation, and, after giving credit to these items 204 the balance of Rs. 5,08,637 was carried to the balance sheet of the next year on the 1st January, 1946, without making or declaring it a reserve. On the 28th February, 1946, the directors marked it for distribution as dividend, on the 3rd April, a resolution was passed for distributing it as dividend, and a few days, later it was actually distributed as dividend: Held, that as the said sum of R...