9911796707
TMI Blog1968 (8) TMI 8X X X X Extracts X X X X X X X X Extracts X X X X ..... and super-tax payable by the company in respect thereof. The Income-tax Officer, by order dated November 18, 1940, ordered in exercise of the power under section 23A of the Indian Income-tax Act, as then in force, that an amount of Rs. 3,32,691 shall be deemed to be distributed amongst the shareholders as on the date of the general meeting of the company. On December 12, 1941, the Income-tax Officer determined the shares of the different shareholders to whom the income was deemed to be distributed, but gave no effect to the order by including the proportionate shares in the amount of the deemed income in the individual assessments of the shareholders for the appropriate assessment year. On April 24, 1942, the company in a general meeting r ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... was liable to be taxed in the assessment year 1940-41 ; the Commissioner says that the dividend deemed to be distributed could have been taxed in the year 1940-41, but not having been assessed to tax in that year the share of the appellant in the amount actually distributed was liable to be assessed in the assessment year 1943-44. The statutory provisions may first be noticed. Section 23A as it stood at the relevant time, provided : " (1) Where the Income-tax Officer is satisfied that in respect of any previous year the profits and gains distributed as dividends by any company up to the end of the sixth month after its accounts for that previous year are laid before the company in general meeting are less than sixty per cent. of the as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in so far as it is material, provides : " For the purposes of inclusion in the total income of an assessee any dividend shall be deemed to be income of the previous year in which it is paid, credited or distributed or deemed to have been paid, credited or distributed to him, ......" Section 4(1)(b) of the Indian Income-tax Act, 1922, in so far as it is material, provides : "(1) Subject to the provisions of this Act, the total income of any previous year of any person includes all income, profits and gains from whatever source derived which . . . (b) if such person is resident in the taxable territories during such year,--- (i) accrue or arise or are deemed to accrue or arise to him in the taxable territories during such year, or . ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... " Where tax has been paid in respect of any undistributed profits and gains of a company under this section, and such profits and gains are subsequently distributed in any year, the proportionate share therein of any member of the company shall be excluded in computing his total income of that year. " This clause was enacted with the object of preventing double taxation of the same income ; it was enacted thereby that if tax is paid by an assessee in respect of his proportionate share in the dividend deemed to be distributed in consequence of an order under section 23A, any actual distribution of that dividend will not be liable to be taxed. The clause does not mean nor does it imply that, if in contravention of the express statutory p ..... X X X X Extracts X X X X X X X X Extracts X X X X
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