1960 (10) TMI 3

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..... 57 - - - Dated:- 17-10-1960 - Judge(s) : S. K. DAS., M. HIDAYATULLAH., J. C. SHAH JUDGMENT The judgment of the court was delivered by HIDAYATULLAH, J.--This appeal, with special leave, has been filed against the judgment of the Nagpur High Court in a reference under section 66(1) of the Indian Income-tax Act, 1922, by which the High Court answered the following question in the negative : " Whether the proportionate profits on the goods of the value of Rs. 4,10,785 were received or were deemed to be received in British India, in the year of account, by or on behalf of the assessee company within the meaning of section 4(1)(a) of the Indian Income-tax Act, 1922 ? " The Commissioner of Income-tax, Madhya Pradesh and Bhop .....

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..... f accrual. A reference was then made by the Tribunal of the question quoted above. The High Court in deciding the reference went into the question of passing of property under the Indian Sale of Goods Act, 1930, and came to the conclusion that since the property in the goods had passed to the buyers, the Imperial Bank of India, Bhopal, must be "deemed to have received the railway receipts as agents of the buyer." Continuing the reason, the learned judges observed : " So also the branches of the bank at Agra, Allahabad and Delhi acted as the agents of the buyers when they collected the money from them and transmitted it to the Bhopal branch. In this view, the profits cannot be said to be received by the assessee company in British India. .....

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..... doubt whether the property in the goods can be said to have passed to the buyers by the mere fact of the railway receipts being in the name of the consignees, as has been held by the High Court. Since we are not deciding the question of accrual, we do not elaborate the point. Coming now to the question as to where the amount was received, we have no doubt that the view of the Tribunal was correct. This income was received at Agra, Allahabad or Delhi from the buyers by the Imperial Bank acting as the agent of the company. The company had handed over the railway receipts to the bank, and asked the bank not to hand over the railway receipts to the buyers, unless payment was received. This was sufficient to make the bank an agent of the comp .....

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