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Section 4 of the Income-tax Act, 1961 - Company - Assessable as CASE REVIEW Mitchell v. B.W. Noble Ltd. [1927] 1 K.B. 719; 11 Tax Cas. 372 - followed and relied upon. JUDGMENT Chatterjee, J.-The following question has been referred by the Appellate Tribunal, Calcutta Bench, to the High Court for its opinion: "Whether on the facts and in the circumstances of this case, the sum of Rs. 22,500 was taxable in the hands of the applicant company." The applicant is a private limited company incorporated in August, 1932. From the Memorandum of Association of the company, it appears that it was brought into existence to float various companies including cotton mills. In November, 1932, a cotton mill was floated under the name of Basanti Cotton Mills Ltd. By Article 132 of the Articles of Association, the applicant company, the Calcutta Agency Ltd., was appointed the managing agent of the said mill. The managing agents were to receive a monthly allowance of Rs. 500 so long as the subscribed capital did not exceed Rs. 5,00,000 and a commission of 3 per cent, on all gross sales of goods manufactured. In case the subscribed capital exceeded Rs. 5,00,000, then for every Rs. 2,00,000 of the increase the managing agents were to get an additional monthly allowance of Rs. 150. It appears that Nath Bank Ltd. instituted four suits against the Basanti Cotton Mills Ltd. In two out of the said four suits the Calcutta Agency Ltd. was impleaded as the co-defendant. The claim of the Nath Bank Ltd. was on certain hundis drawn by one Mr. S.C. Mitter purporting to act on behalf of the Calcutta Agency Ltd. These suits were decreed for Rs. 31,593-9-3 and Rs. 21,054-2-9. These decrees were passed by consent of the parties. In the other two suits in which the applicant company was not a party decrees were passed for Rs. 1,15,735-12-5 and for Rs. 21,593-8-3. An agreement was entered into between the applicant company and the Basanti Cotton Mills Ltd. Inasmuch as a good deal of argument has been advanced on the language of this agreement, the same is set out below:- "Memorandum of agreement made between the Calcutta Agency Limited of the one part and Basanti Cotton Mills Limited of the other part…

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