Concerted action inquiry was essential to decide public interest status under income tax law on the existing record.

The existing statement of case was insufficient because it did not contain the enquiry required to determine whether the Kedia family members were acting in concert in relation to the company's affairs, which was material to deciding whether the assessee-company was one in which the public were substantially interested under section 23A of the Indian Income-tax Act, 1922. The tribunal's inference had been drawn without examining relevant shareholder conduct, board resolutions, general meeting proceedings, and other material bearing on concerted action. On that incomplete record, the court could not properly answer the reference and directed submission of a further supplementary statement of the case.

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Issues: Whether, on the existing statement and supplementary statement of the case, the court could answer the question whether the assessee-company was a company in which the public were substantially interested within the meaning of section 23A of the Indian Income-tax Act, 1922, and whether a further supplementary statement was required.

Analysis: The record did not contain the necessary enquiry into whether the members of the Kedia family were acting in concert in relation to the affairs of the company, which was the material inquiry directed by the Supreme Court. The Tribunal's inference was drawn without examining relevant facts such as the conduct of the shareholders in relation to the company's affairs, the resolutions of the board, the proceedings of the general meetings, and other materials bearing on concerted action. In the absence of these relevant facts and materials, the court could not properly answer the reference on the basis of the existing record.

Conclusion: The question could not be answered on the present materials and the Tribunal was directed to submit a further supplementary statement of the case under section 66(4) of the Indian Income-tax Act, 1922.

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