Law:

Section:

Section 9 of the Income-tax Act, 1961 [Corresponding to section 4(1) of the Indian Income-tax Act, 1922] - Income - Deemed to accrue or arise in India - Assessment years 1939-40 to 1943-44 - Assessee company, resident outside British India, had appointed 'B' Ltd. as managing agents in British India - 'B' Ltd. carried on extensive business in coal on behalf of assessee in British India - It was found from records that contracts for sale of coal were accepted in British India, and that cheques for payment of price were also received in British India - Whether, on facts, profits on sale of coal to customers in British India constituted profits accruing or arising in British India within meaning of section 4 of 1922 Act - Held, yes FACTS The assessee was a limited company having its registered office at Deccan, outside British India. One 'B' Ltd., Madras, were appointed managing agent of the company under an agreement, which carried on extensive business in coal on behalf of the company under which coal was sold under contracts to State-managed and company-managed railways in British India, to the Madras Electric Supply Corporation and also through brokers or agents in specified areas in British India. A large volume of business amounting to several lakhs was done by the company. As the company was resident outside British India, the question raised was whether its income was to any extent assessable under the 1922 Act. It was found by the Tribunal that the contracts for sale of the goods were accepted in British India, and that the cheques for the payment of the price were received in British India. On these facts it was opined that the profits not only accrued or arose in British India but that they were also received in British India. It was further held on the facts that there was a business connection to justify an apportionment in cases where it was not clear whether the income accrued or arose or was received in British India. On reference: HELD It was seen from records that under the managing agency agreement 'B' Ltd. were authorised to deposit the monies in the National Bank of India at Madras and in such other banks as the company might direct. There was…

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