Apportionment of profits to a taxing territory upheld where concurrent estimates were supported by record and canvassing operations existed locally.

The apportionment of profits from impugned sales to British India was upheld where the assessee maintained canvassing arrangements there and part of the sales groundwork was done in that territory. The Supreme Court had already concluded that the sales were taxable in British India, leaving only the division of profits for determination. As the Appellate Assistant Commissioner and the Tribunal had concurrently estimated one-third of the profits as attributable to British India, the HC declined interference in reference jurisdiction because no material showed that the estimate was erroneous, grossly improper, or unsupported by the record.

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Issues: Whether the Tribunal was right in holding that one-third of the profits from the impugned sales accrued or arose in British India and could be attributed to operations carried on there.

Analysis: The prior determination that the sales were taxable in British India stood concluded by the Supreme Court, leaving only the apportionment of profits for decision. The Court held that the assessee maintained canvassing arrangements in British India and that the groundwork for the sales was partly done there. The proportion of profits attributable to British India had been concurrently estimated by the Appellate Assistant Commissioner and the Tribunal at one-third, with the remaining two-thirds attributable to Indore State. In reference jurisdiction, the Court found no material to show that the estimate was erroneous, grossly improper, or otherwise open to interference. The cited authorities on canvassing agents and on apportionment did not displace the concurrent factual estimate on the record.

Conclusion: The apportionment of one-third of the profits to British India was upheld, and the question was answered in the affirmative against the assessee.

Ratio Decidendi: A concurrent estimate of the proportion of profits attributable to operations in a taxing territory will not be disturbed in reference jurisdiction unless it is shown to be erroneous, grossly improper, or unsupported by the material on record.

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