HON’BLE SUPREME COURT · SOURCE-REVIEWED NOTE
Howrah Trading Co. Ltd. v. Commissioner of Income-tax, Calcutta
Civil Appeal No. 65 of 1956
[1959] Supp. (2) SCR 448 ·
Indian Income-tax Act, 1922: sections 16(2), 18(5), 19A, 20, 49B
Sources & disclosures includedDownload original judgment / order
3-judge bench · B. P. Sinha · J. L. Kapur · M. Hidayatullah
Assessment years: 1944-45, 1945-46, 1946-47, 1947-48
01 · Facts of the case
Shares acquired through blank transfers remained registered in other persons’ names. Although the assessee received dividends, it claimed grossing-up and corresponding credit for company tax under sections 16(2) and 18(5). Authorities and the High Court rejected the claim.
Source: Primary report: SCR 449–451
02 · Discussion by the Hon’ble Court
Company tax was the company’s own liability. The historical grossing-up and credit scheme benefited a shareholder understood with the Companies Act and sections 19A and 20 as the registered member. An unregistered transferee had equitable rights against the transferor but no equivalent membership claim against the company.
Source: Primary report: SCR 452–458
03 · Judicial decision
Equitable ownership alone did not entitle this unregistered transferee to the claimed grossing-up and section 18(5) credit. The High Court’s negative answer was correct.
Source: Primary report: SCR 457–458
04 · Outcome / in whose favour
The assessee’s appeal was dismissed with costs.
Source: Primary report: SCR 458
05 · AKHB REVIEW POINT
Distinguish beneficial rights between transferor and transferee from statutory credit eligibility under the then-existing dividend regime. Do not use this historical grossing-up decision as a substitute for present dividend/TDS or depository legislation.
Source: Primary report: SCR 453–458
Source & verification
Download original judgment / order · Open cited source rendition
Complete 11-page Supreme Court Reports scan. Any adjoining report fragments remain in the unchanged original and are excluded from this analysis.
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.
AI disclosure & professional disclaimer
This AKHB research note uses AI assistance and a preserved full-primary review, with refreshed exact original-byte verification. Independent human review is not represented.
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.