TMI Blog1972 (11) TMI 3X X X X Extracts X X X X X X X X Extracts X X X X ..... essee for the deduction of Rs. 31,26,000 was rightly rejected as coming under s. 2(m)(ii) - - - - - Dated:- 10-11-1972 - Judge(s) : K. S. HEGDE., P. JAGANMOHAN REDDY. and H. R. KHANNA. JUDGMENT The judgment of the court was delivered by HEGDE J.-- These appeals are by certificate. They arise from the consolidated judgment of the High Court of judicature at Madras in a reference under ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and they lie within a narrow compass. The assessee is a public limited company established with a view to carry on the business of merchants, store-keepers, commission agents, retailers, manufacturers, hotel-keepers and catering service. The assessee was mainly carrying on business in South India. There was another company known as M/s. G.F. Kellner Co. (hereinafter referred to as " Kellners ") ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rth Western Railway and its goodwill for a consideration of Rs. 31,26,000. Part of this consideration was to be paid in cash on demand by Kellners. One of the terms of the agreement was as under : " If while the said Rs. 31,26,000 mentioned in clause (2) or any part thereof remains unpaid G.F. Kellner and Company Ltd. shall propose to go into voluntary liquidation any special resolution submitt ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is true that the assessee had a controlling interest in Kellners but that does not, in law, make Kellners a part of the assessee-company. The Kellners and the assessee-company are two different legal entities. It was alleged by the assessee and not denied by the revenue that Kellners have been assessed to wealth-tax in the relevant accounting periods and in computing its net wealth the debt of Rs ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ntion of Mr. A. N. Kirpal, the learned counsel for the revenue, that because the assessee had a controlling interest in Kellners, its liability ceased to be a " debt " is unsustainable in law. As mentioned earlier, the two companies are different legal entities. Whatever control may have had over Kellners, the Kellners continued to be a separate legal entity. We see no merit in these appeals. I ..... X X X X Extracts X X X X X X X X Extracts X X X X
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