1978 (12) TMI 26

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..... F. W. Heilgers Co. (P.) Ltd. The face value of the ordinary shares of both the companies are Rs. 100 per share and the face value of the deferred shares of both are Rs. 10 per share. For the assessment year 1957-58 the WTO estimated the market value of the ordinary shares of Messrs. Bird Co. (P.) Ltd. at Rs. 172 per share and that of Messrs. F. W. Heilgers Co. (P.) Ltd. at Rs. 198 per share and the deferred shares of both the said companies at 1/10th of the value of their respective ordinary shares estimated respectively as aforesaid. For the assessment year 1958-59, the value of the ordinary shares was estimated at Rs. 163 Der share of Messrs. Bird Co. (P.) Ltd. and Rs. 169 per share of Messrs. F.W. Heilgers Co. (P.) Ltd. and .....

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..... or the opinion of this court : " Whether, on the facts and in the circumstances of the case, the Tribunal was right in holding that in determining the market value of the deferred and the ordinary shares held by the assessee in Messrs. Bird Co. (P.) Ltd. and Messrs. F. W. Heilgers Co. (P.) Ltd. the proposed dividends on cumulative preference shares were required to be deducted from the gross value of the assets of the two companies as at the relevant valuation dates?" It appears to us that though the parties proceeded on the admitted basis that the shares of the said two companies would be valued on the break-up method and there was no dispute as to the method of valuation yet by reason of a subsequent judgment of the Supreme Court .....

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..... In such companies the restriction on share transfers will also be taken into consideration as earlier indicated in arriving at a valuation. (4) Where the dividend yield and earning method break down by reason of the company's inability to earn profits and declare dividends, if the set-back is temporary then it is perhaps possible to take the estimate of the value of the shares before set-back and discount it by a percentage corresponding to the proportionate fall in the price of quoted shares of companies which have suffered similar reverses. (5) Where the company is ripe for winding up then the break-up value method determines what would be realised by that process. (6) As in Attorney-General of Ceylon v. Mackie [1952] 2 All ER 775 ( .....

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