Law: Income Tax Act, 1922

Section: 15B

Law: Income Tax Rules, 1922

Section: 3,9

Income-tax Act, 1922 -- Section 15B -- Income-tax Rules -- Rules 3, 9 -- Sales of Goods Act (III of 1930) -- Section 5 -- Companies Act (VII of 1913) -- Section 105C -- Capital employed -- Company passing resolution for issuance of new shares to existing shareholders -- Existing shareholders accepting offer and depositing the requisite amount in offers of company -- Issuance of share certificate to existing shareholders, whether necessary -- Held no -- Amount deposited by shareholders -- Whether proper share capital -- Held yes -- Whether capital employed for the purposes of computation of capital under Section 15B of the Act -- Held yes -- Company passing resolution for issuance of new shares to existing shareholders under Section 105C, Companies Act -- Shareholders accepting offer and depositing requisite amount of Rs. 71,86,800 -- Held, on offer of new shares to existing shareholders and acceptance of offer by latter the contract was complete and issuance of share certificate not necessary -- Amount of Rs. 71,86,800, held, proper share capital and not mere deposit of advances -- Computation for purposes of Section 15B, Income-tax Act to be made accordingly -- Issuance of further shares to existing shareholders -- Offer of new shares, by company, accepted by existing shareholders -- Offer of new shares, by company, accepted by existing shareholders and price for acquisition of shares duly deposited in coffers of company -- Held, all formalities of contract of sale of goods, under Section 5, Sale of Goods Act, complete from date shareholders accepted offer - JUDGMENT The judgment of the Court was delivered by MUSHTAQ HUSSAIN J.--- Messrs. Crescent Textile Mills Limited, Lahore, is a company registered under the Companies Act. In consequence of sanction granted by the Central Government to rise the share capital, the Board of Directors of the Company passed a resolution on the 28th February, 1958, for the issuance of new shares to the existing shareholders under Section 105C of the Companies Act. 2. When the shares were offered to the existing shareholders they accepted the offer and a sum of Rs. 71,86,800 was deposited in all. This amount was deposited during…

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