Law:

Section:

section 154 of the income-tax act, 1961, read with paragraph d of part ii of first schedule to the finance act, 1964, and paragraph f of part i of first schedule to the finance act, 1965-rectification of mistake-apparent from record-assessee was a state financial corporation-its capital consisted of one class of shares and all shares carried equal rights-whether it could be said that assessee's shares were preference shares-held, on facts, no-whether it was a debatable question as to whether shares of assessee-company could be regarded as preference shares entitling it to rebate under provisions of the finance acts, 1964 and 1965 and, therefore, once ito had treated assessee's shares in original assessment as preference shares and allowed rebate qua dividend on such shares, he could not rectify assessment under section 154 to withdraw rebate-held, yes Facts The assessee, a State financial corporation, was established by the Rajasthan Government under the provisions of the State Financial Corporation Act, 1951. During the accounting years, relevant to the assessment years 1964-65 and 1965-66, the assessee was duly assessed by the ITO but subsequently the ITO rectified the aforesaid assessments under section 154 and reduced by 7.5 per cent the rebate allowed by him to the assessee in respect of its income under the first proviso to Para D of Part II of the First Schedule to the Finance Act, 1964, and under first proviso to Para F of Part I of the First Schedule to the Finance Act, 1965. The rebate was reduced on the ground that the shares of the assessee-company were not preference shares and under the provisions of the aforesaid Finance Acts, the rebate was to be reduced on the dividend other than dividend on preference shares. On appeal, the AAC held that the expression 'preference shares' presupposed existence of at least two categories of shares which was not so in the assessee's case and that from the provision of the State Financial Corporation Act, it could not be inferred that the assessee's shares enjoyed any preference for payment of dividends. Therefore, according to the AAC, the liability for payment of excess dividend tax was already attracted.…

Deprecated: trim(): Passing null to parameter #1 ($string) of type string is deprecated in /home/digixyei/sldsystempk.com/view/master-layout/view_case.php on line 492