HON’BLE SUPREME COURT · SOURCE-REVIEWED NOTE
Commissioner of Income-tax v. McMillan & Co.
Civil Appeal 29 of 1955
[1958] SCR 689 ·
Indian Income-tax Act 1922, sections 13 and 31(3) · Indian Income-tax Rules 1922, rule 33
Sources & disclosures includedDownload original judgment / order
3-judge bench · N. H. Bhagwati · S. K. Das · J. L. Kapur
Assessment years: 1944–45
01 · Facts of the case
A non-resident publisher valued supplies to Indian branches at percentages of marked prices. The Income-tax Officer accepted that accounting basis. On the assessee’s appeal, the appellate authority gave enhancement notice and recomputed Indian income by reference to world profits and turnover.
02 · Discussion by the Hon’ble Court
The majority held that the section 13 opinion is a reasoned statutory determination, not an inviolate personal discretion. Once properly seized of the assessment, the appellate authority could revise the accounting-method determination and apply rule 33. Bhagwati J. dissented, considering rejection of the method reserved to the Income-tax Officer and allowing only remand for fresh exercise.
Source: Primary report: Majority SCR 697–710; dissent SCR 719–738
03 · Judicial decision
Revenue appeal allowed by majority; High Court judgment set aside and first two reference questions answered affirmatively. Third question did not arise. Each party bore its own costs throughout.
04 · Outcome / in whose favour
Revenue succeeded on appellate jurisdiction to reject the accounting method and use rule 33 after notice.
Source: Primary report: SCR 710–711, 738
05 · AKHB REVIEW POINT
Separate a jurisdictional power from justification for an estimate on evidence. The case concerned the existing assessed business, not a new source of income; the majority expressly distinguished new-source cases. Preserve reasonable opportunity before enhancement and distinguish the dissent from the operative ruling.
Source: Primary report: SCR 695, 703–710
Source & verification
Download original judgment / order · Open cited source rendition
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Statutory scope
Historical legislation expressly identified in this note. This is not a decision under the Income-tax Act, 1961 or the Income-tax Act, 2025. Verify enacted wording, commencement, transition and subsequent judicial treatment independently before modern reliance.
Later treatment
Source checked 2026-10-23. Subsequent treatment and present-law applicability have not been comprehensively checked.
Page references identify the supplied PDF; paragraph references identify the judgment unless stated otherwise.
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General legal and tax research only; not legal or tax advice. Verify the complete judgment, applicable statutory version and subsequent treatment before reliance. AKHB REVIEW POINT is editorial analysis, not the Court’s holding.