HON’BLE SUPREME COURT · SOURCE-REVIEWED NOTE
Commissioner of Income-tax, Bangalore v. Union of Tile Exports, Bangalore
Civil Appeal Nos. 1769-1771 of 1967
[1969] 2 SCR 55 ·
Indian Income-tax Act, 1922: sections 4(1)(a), 42(3) and 66(1) · Part B States (Taxation Concessions) Order, 1950: paragraphs 4(1)(iii), 6, 6A and 7
Sources & disclosures includedDownload original judgment / order
3-judge bench · J.C. Shah, J. · V. Ramaswami, J. · A.N. Grover, J.
Assessment years: 1951-52, 1952-53, 1953-54
01 · Facts of the case
The Bangalore firm was sole selling agent for specified Ceylon territories for tiles made at Feroke. Prices were FOB Beypore; an employee at Calicut supervised delivery and chartered vessels; shipping documents went to Bangalore, where the firm submitted hundis, invoices and documents to its bank under the Ceylon purchaser's letter of credit. For assessment years 1951-52 to 1953-54, it claimed Part B State concessions. Tax authorities treated hardly any profit-producing activity as occurring at Bangalore. The Mysore High Court instead found operations at Bangalore, Feroke and Ceylon and allowed concessions for the reasonably apportioned Bangalore and Ceylon portions.
Source: SCR pp. 56-58 / PDF pp. 2-4
02 · Discussion by the Hon’ble Court
Section 42(3) required reasonable apportionment when not all business operations producing profit occurred within taxable territories. The Court rejected Revenue's attempt to confine profit production to manufacturing, shipping and delivery outside Bangalore. Making the contracts at Bangalore was an integral part of the selling operations: the later purchase, shipment and collection activity proceeded under those contracts. Because at least part of the profit-producing activity took place there, the High Court's three-location analysis and consequent concession treatment could not be displaced.
Source: SCR pp. 58-59 / PDF pp. 4-5
03 · Judicial decision
The Supreme Court affirmed that contract formation at Bangalore was an integral business operation, upheld the High Court's apportionment/concession conclusion and dismissed all three Revenue appeals with costs.
Source: SCR p. 59 / PDF p. 5
04 · Outcome / in whose favour
In favour of the assessee. Profits were not treated as arising wholly in one taxable-territory location; the historical concessions applied to the properly apportioned Bangalore and Ceylon business operations.
Source: SCR pp. 57-59 / PDF pp. 3-5
05 · AKHB REVIEW POINT
AKHB analysis: territorial profit attribution requires a functional map of each operation that materially produces the profit, including contract formation where it sets the later transaction in motion. Do not allocate solely by registered office, receipt location, manufacture or delivery. The apportionment principle remains historically useful, but the operative concession order and taxable-territory framework must not be imported into a current statute or treaty analysis.
Source & verification
Download original judgment / order · Open cited source rendition
Full 5-page SCR report read; editorial headnote on PDF page 1 distinguished from the judicial opinion on PDF pages 2-5.
- Exact catalogue bytes verified: SHA-256 3010a3f2a246caa3ead41e45d48bccc0830f47e89702dc30b93ab56630ab69c9; 5 PDF pages.
- SCR cover and judicial caption verify 10 September 1968, Civil Appeal Nos. 1769-1771 of 1967 and the three-member bench; Grover J. delivered the opinion.
Statutory scope
The case concerns the Indian Income-tax Act, 1922 and the historical Part B States (Taxation Concessions) Order, 1950. Its result is not a current territorial-income or treaty rule.
Later treatment
Source checked 2026-10-10. Later statutory changes and subsequent treatment have not been comprehensively checked. No current-law clearance is asserted.
Page references identify the supplied PDF; paragraph references identify the judgment unless stated otherwise.
Coverage, AI disclosure & professional disclaimer
Selected Supreme Court income-tax decisions and procedural orders checked against their identified sources. This collection is not exhaustive. The research catalogue has 2,569 indexed PDF assets, including alternate copies and incidental matches; that is not a count of unique or reviewed judgments. Historical and unreported coverage remains open.
AI-assisted research checked against the identified source. Extraction, interpretation or omission errors remain possible. Source review does not mean independent approval by a practising professional. Verify every material statement against the complete original judgment.
General research information only; not legal or tax advice, a certified judgment or a substitute for the full order. Applicability depends on facts, assessment year, statutory version and jurisdiction. Subsequent treatment is unverified unless a note expressly identifies the sources checked. Downloading does not create a professional engagement. Obtain case-specific advice before reliance.
The official 1961–2025 structural correspondence does not establish that a precedent applies under the new Act. Verify the enacted wording, commencement and transitional provisions separately.