1972 (9) TMI 3

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....tax Act, 1922 (hereinafter called "the Act"), is as follows: " Whether, on the facts and in the circumstances of the case, the Tribunal was right in holding that in the matter of calculation of undistributed balance of the total income of an assessee for the purpose of levy of super-tax in terms of section 23A(1) of the Income-tax Act, 1922, the Income-tax Officer should have taken into consideration dividend declared by the company after the period of 12 months immediately following the expiry of the previous years relevant to the assessment years 1958-59 and 1959-60 but before the date on which the orders under section 23A(1) had been made by the Income-tax Officer ?" The High Court has answered that question in the affirmative and ....

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....the relevant parts of the section came to the conclusion that in computing the undistributed balance of the total income not only the income-tax and super-tax payable by the company but also any other tax levied by the local authority, etc., are to be deducted but also "dividends actually distributed, if any", which are the words used in the latter part of section 23A(1). It was also of the view that no time limit was applicable in taking into account the actual distribution of dividends in passing an order under section 23A(1) by the Income-tax Officer; as such it directed that the sums of Rs. 15,000 and Rs. 90,000 were to be taken into account in arriving at the undistributed balance of the total income of the respondent-company for the p....

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....the sum determined as payable by it on the basic of the assessment under section 23, be liable to pay super-tax at the rate of fifty per cent. in the case of a company whose business consists wholly or mainly in the dealing in or holding of investments, and at the rate of thirty-seven per cent. in the case of any other company on the undistributed balance of the total income of the previous year, that is to say, on the total income as reduced by the amounts, if any, referred to in clause (a), clause (b) or clause (c) and the dividends actually distributed, if any. " This provision is procedural and applies only to companies in which the public are not substantially interested. It seems to have been enacted with a view to deter private co....