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Case Laws
Showing 81 to 92 of 92 Records
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1962 (4) TMI 40
Winding up - Preferential payments ... ... ... ... ..... advanced by the State. It may be said that the State has certain prerogatives, but it is also open to the State to give up any one of such prerogatives. The State is equally bound by the provisions the Companies Act as any other citizen. The State, when enacting such a provision and confining its preferential claim to all revenues, taxes, cesses and rates due from the company to the Central or a State Government.. . is deemed to renounce its priority with regard to other claims which may be in the nature of loans, etc. It is a sound argument that when preferential claims are specified, there is no longer any priority attached to the unspecified claims of the Government. I am inclined to the view, in these circumstances, that, priority is not available to the Union of India with respect to its claims detailed above in this case. The result of the above discussion is that the Union of India is entitled to receive a sum of Rs. 16,804.27 from the company as an ordinary creditor.
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1962 (4) TMI 39
Share capital - Further issue of ... ... ... ... ..... to my mind, in the present application, if the respondents Nos. 4 and 5 wanted to succeed on the ground that they were bona fide purchasers for value without notice, the price that they paid or the consideration that passed from them should have been specifically averred in their affidavit or in the affidavit of the seller. In the absence of these material averments I am not inclined to entertain the plea at all. It is not however necessary to decide this point, as I have held that the respondent No. 3 on the facts of this case had no right to renounce the new shares in favour of the respondents Nos. 4 and 5. Mr. Bikash Sen, who appears on behalf of the company, viz., the respondent No. 1, is not opposing this application. In the result there will be an order in terms of clauses (a ) and (b) of the prayers in the petition. The petitioner will get the costs of this application from the respondents Nos. 2 to 5. The company will bear and pay its own costs. Certified for counsel.
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1962 (4) TMI 38
What are the terms and conditions on which the deposits in question were made?
Whether on those terms and conditions there has been a violation of section 4(1) of the Act by the appellant?
Whether the imposition of penalty under section 23(1)(a) of the Act is bad on the ground that the section is in contravention of article 14 and in consequence void?
Held that:- We are satisfied that the deposits in account No. 50180 were made by the German firms on the conditions stated by the appellant. We have reached this conclusion on a consideration of the evidence on record, without reference to any abstract doctrine as to burden of proof. But it is only right to observe, that the proceedings under the Act are quasi-criminal in character and it is the duty of the respondent as prosecutor to make out beyond all s reasonable doubt that there has been a violation of the law
The right of the appellant to the amounts in deposit is, it is argued, contingent on the happening of these events and that until then there was no debt due to him and section 4(1) had no application.
The appellant has only a contingent Tight to the amounts standing in credit in account No. 50180 and that the deposits were made in the bank not in the course of normal banking business but under a special arrangement, it must be held that there was no lending of those amounts by the appellant to the bank within section 4(1) of the Act and the order of the Appellate Board imposing a fine of ₹ 5 lakhs on him under section 23(1)(a) must be held to be illegal and set aside.
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1962 (4) TMI 29
Oppression and mismanagement, Winding up – Powers of tribunal on hearing petition and Appeals from orders
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1962 (4) TMI 28
Conviction under section 120B read with section 409, Indian Penal Code and section 477A, Indian Penal Code - Held that:- The vouchers were falsified with one intention only and that was to let it go unnoticed that the Union Agencies had got funds from the Insurance Company. If they had shown the money received and paid to Bhagwati Trading Company, it was possible to trace the money back to the Insurance Company through Bhagwati Trading Company which received the money from the Insurance Company through crossed cheques as well. Whoever would have tried to find out the source of the money would have been deceived by the entries. The Union Agencies made wrongful gain from the diversion of the Insurance Company's funds to it through Bhagwati Trading Company and the insurance Company suffered loss of funds. The false entries were made to cover up the diversion of funds and were thus to conceal and, therefore, to further the dishonest act already committed.
In the present case, introduction of Bhagwati Trading Company in the transactions was the first step to carry out deception about the actual payment of money out of the funds of the Insurance Company to the Union Agencies.
The second step of suppressing the name of Bhagwati Trading Company in the papers of the Union Agencies, Delhi, made it more difficult to trace the passing of the money of the Insurance Company to the Union Agencies and, therefore, the falsification of the journal vouchers related back to the original diversion of the Insurance Company's moneys to the Union Agencies and was with a view to deceive any such person in future who will be tracing the source of the money received by the Union Agencies.
We are therefore of opinion that Gurha has been rightly held to have been in the conspiracy and to have abetted the making of the false journal vouchers.In view of the above, we are of opinion that the appellants have been rightly convicted of the offences charged.
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1962 (4) TMI 7
Whether it was competent to the company by a subsequent resolution to reverse an earlier resolution declaring the dividend?
Held that:- Payment made as dividend by a company to its shareholders does not lose that character merely because it is paid out of capital. Under the Income-tax Act, liability to pay tax attaches as soon as dividend is paid, credited or distributed or is so declared. The Act does not contemplate an enquiry whether the dividend is properly paid, credited or distributed before liability to pay the tax attaches thereto. The answer to the contention for reasons already set out by us must be in the negative. Appeal dismissed.
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1962 (4) TMI 6
How far section 35(5) is retrospective and whether it would apply to original assessments completed before April 1, 1952, is no longer res integra?
Held that:- Here, the original assessment was made before the amendment, and to that assessment the amended, provision cannot still be made applicable, even though the assessments of the firms were after April 1, 1952. The assessment of the respondents was a final assessment before April 1, 1952, and sub-section (5) has not been made applicable to such assessment, either expressly or by implication. In our opinion, sub-section (5) could not be used in this case, and the decision of the High Court was right.
Being a final assessment, it could be rectified only under the law, as it stood then. That law did not include the fiction enacted by sub-section (5), which, when enacted, could not be used in those cases which had been finally closed before April 1, 1952. Appeal dismissed.
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1962 (4) TMI 5
Whether the U.P. Zamindari Abolition and Land Reforms Act (U.P. Act 1 of 1951) is unconstitutional and void inasmuch as it is beyond the legislative competence of the U.P. Legislature, and this contention raises the question about the construction of entry 49 in List II of the Seventh Schedule of the Constitution?
Held that:- The fact that agricultural income having been specifically provided by entry 46 cannot be deemed to be included in entry 49, does not justify the argument that the word " lands " in the latter entry does not include agricultural lands. There can be no doubt that the Act was within the legislative competence of the U.P. Legislature and so, the challenge to its validity on the ground that it has been passed without legislative competence must be rejected.
Whenever the validity of a taxing statute is challenged on the ground that it contravenes article 14 or article 19, the challenge cannot be thrown out on the preliminary ground that a tax law is beyond such challenge, but its merits must be carefully examined. Therefore, in our opinion the challenge to the validity of the Act on the ground that it contravenes article 31(2) is not well-founded.
The petitioner has not stated the extent of the rent which he is required to pay for his land-holdings. He holds the lands as bhumidar and the respondents contend that the rent recovered from bhumidars is very law. It was even suggested during the course of argument by Mr. Aggarwal that the rent recovered from the bhumidars would not exceed 1% of the gross income and in some cases it may even be less. Unfortunately, the petitioner has not made any statement about this important particular. The operation of the rates prescribed by the Schedule is based on the annual valuation of the lands, and the said valuation is determined ultimately on the basis of the rent, so that unless the rent is known, the extent of the impost cannot be adequately judged. Therefore, in our opinion, on the material adduced by the petitioner before us, it is impossible to accept the argument that the tax levied by the Act is confiscatory. Besides, as we have already seen, the scheme of the present Act does not disclose any constitutional infirmity either in its charging sections or in the sections providing for the procedure for the levy of the tax and its recovery. That is why we feel no hesitation in holding that there is no substance in the plea that the Act is a colourable piece of legislation. Appeal dismissed.
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1962 (4) TMI 4
Whether in computing the profits of a business carried on by a company deduction shall be made in respect of any remuneration to any managing agent where such remuneration is included in the profits of the managing agent's business for the purposes of the war profits tax ?
Held that:- It is unnecessary for our present purpose to consider whether besides section 5(1)(b), already referred to, there are other contingencies in which remuneration received by a director could be held not to be " included " in the latter's profits under the Ordinance, since in the case before us it is admitted that the remuneration received by the managing agent was liable to be included in the computation of his profits for the purposes of the war profits tax and, therefore, neither the fact that the managing agent did not " include " the sum in his return, nor the default of the assessing authority to correct this error by " including " the sum in his assessment, is any reason for depriving the respondent company of the benefit of proviso (b) to rule 4(1). Appeal dismissed.
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1962 (4) TMI 3
Certificate Proceedings, Legal Representative ... ... ... ... ..... tends to the collection of the tax from the legal representative of the assessee. It was pointed out by this court that the distinction between an assessee and other person in section 29 does not bear upon this matter, because the legal representative is in himself the assessee and as an assessee in default, liable to penalties under section 46(1). It, therefore, follows that if the legal representative, who was proceeded against under section 24B(2), must be deemed to be an assessee for the purpose of assessment, levy and collection of tax, the provisions of sections 45, 46(1) and also 46(2) must apply to him. In our opinion, both the certificate issued under section 46(2) and the notice of July 17, 1956, were valid, and the High Court was in error in quashing the former and setting aside the latter. The appeal is thus allowed. The judgment of the High Court is set aside and the writ petition ordered to be dismissed. There shall be no order as to costs here. Appeal allowed.
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1962 (4) TMI 2
Confiscation (Customs) ... ... ... ... ..... common in bullion dealing as is well known to you. 14.The question of fulfilling the obligation under a contract is one that arises after the contract. The more important questions are (1) was there such a contract? (2) If there was one, was the subject matter smuggled gold (which he must have acquired for a low price) or gold acquired from open market? It seems to me that the contract itself, is doubtful, and, even if there was a contract, it must have related only to contraband gold. It follows that this seized gold was really contraband. This is the view taken by the Collector, and, in my opinion, it is correct. 15.The petitioner has failed to make out a case for the issue of a writ. The writ petition fails and is dismissed with costs. The rule nisi is discharged. W.P. No. 517/58. The petitioner in W.P. 516/58, has filed this petition, seeking the alternative remedy by way of Mandamus. There are no grounds for a mandamus. This petition is also dismissed, but without costs.
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1962 (4) TMI 1
Whether the "feed-oats" fell within Item 42 or within Item 32 of the Circular?
Held that:- In the present case it could not be contended that uncrushed oats did not answer the description of "grain" and therefore the decision of the Customs authorities holding that the oats imported fell within Item 32 could not be said to be a view which on no reasonable interpretation could be entertained.
The mere fact therefore that a grain is capable of being used as horse or other cattle feed does not make it "fodder" excluding it from the category of grain to which it admittedly belongs. The decision of the Assistant Collector and of the Collector on appeal holding the oats imported by the respondent to be grain cannot therefore be characterised as perverse or mala fide and in the circumstances we consider that the learned Judges of the High Court erred in interfering with the order of the appellant. Appeal allowed.
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