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TMI Blog1987 (10) TMI 12X X X X Extracts X X X X X X X X Extracts X X X X ..... he total shares of the company during the relevant accounting years in determining the total voting power of the company. The status of the assessee for the two assessment years 1976-77 and 1977-78 as " a company in which the public are not substantially interested " has to be determined with reference to sub-clause (iii) of clause (B)(b) of section 2(18) of the Income-tax Act, 1961. The assessee claimed to be a non-controlled (widely held) company. According to the Revenue, the shares carrying more than fifty per cent. of the total voting power of the assessee-company had been held by four persons during the relevant previous years and the company is hit by the above clause. Under this sub-clause, a company which is not a private company ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ntion advanced on behalf of the assessee is that in construing the expression " the shares carrying more than fifty per cent. of its total voting power " under sub-clause (iii), what is to be reckoned is the total number of shares issued and the shareholding of the members concerned, and if the percentage is worked out in that manner, the assessee herein would not fall within the mischief of the aforesaid clause. There can be no dispute that in construing a fiscal statute, nothing can be read into the provision and the words have to be assigned the ordinary meaning attributable to the same. However, a plain reading of the sub-section itself shows that at no point of time during the accounting year, there can be concentration of voting power ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uted. The total voting power at any time carried by the shares would mean the total voting power that could be exercised at any point of time. If, in respect of a block of shares, the members are precluded from exercising the voting power during a particular year, it is not possible to hold that the said block of shares carry voting power during that year. Therefore, it is not the total number of shares but it is the total number of shares carrying voting power at any point of time that has to be reckoned for the purpose of computing the fifty per cent. stipulated under sub-clause (iii). If in respect of the block of 15,001 shares originally held by the late Ramakrishnan, the heirs of Ramakrishnan could not exercise any voting power until t ..... X X X X Extracts X X X X X X X X Extracts X X X X
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