JUDGMENT

S.C. Agrawal, J.-These appeals, by certificate granted under Section 261 of the Income Tax Act, 1961 (hereinafter referred to as the Act ), have been filed by the Godhra Electricity Co. Limited, (hereinafter referred to as the assessee company ) against the judgment of the Gujarat High Court dated February 24-25, 1982 in Income Tax References Nos. 288 of 1975, 73 of 1978 and 171 of 1978. Income Tax Reference No. 288 of 1975 related to the assessment year 1969-70, while Income Tax Reference No. 73 of 1978 related to the assessment years 1970-71 and 1971-72 and Income Tax Reference No. 171 of 1978 related to assessment year 1972-73.

2. On November 19, 1922 the then Government of Bombay granted a licence under the Indian Electricity Act, 1910 to Lady Sulochana Chinubhai & Company Authorising it to generate and supply electricity to the consumers in Godhra area. The assessee-company is the successor of the said licensee. On the recommendations of a Rating Committee constituted under Section 57(2) of the Electricity (Supply) Act, 1948 the State Government had fixed the charges for supply of electricity and motive power by the assessee-company with effect from February 1, 1952. After the amendment of the Electricity (Supply) Act, 1948 in 1956 the assessee-company increased the charges for motive power from January 1, 1963 to 35 np. per unit with a maximum of Rs. 7 per month for every installation and a few months thereafter on June 22, 1963 the assessee-company increased the rates for electricity supplied for lights and fans to 70 np. per unit with a minimum of Rs. 5 of every installation with effect from July 1, 1963. This unilateral increase in the rates for supply of motive power as well as electricity for lights and fans led to the institution of two representative suits by the consumers (Civil Suits Nos. 152 of 1963 and 50 of 1964) in the court of Civil Judge (Senior Division) at Godhra wherein the right of the assessee-company to unilaterally increase the charges in respect of motive power and lights and fans was challenged. The said suits were decided by the trial court in favour of the consumers and the decree of the trial court was affirmed in appeal by the Assistant Judge, Panchmahals at Godhra. The second appeals filed by the assessee-company were dismissed by the learned single Judge of the Gujarat High Court on April 11, 1966 but the Letters Patent Appeals (L.P.As. Nos. 42 & 43 of 1966) filed by the assessee-company against the said judgment of the learned single Judge were allowed by the Division Bench of the High Court by judgment dated December 3, 1968 and both the representative suits filed by the consumers were dismissed. It was held that under the Electricity (Supply) Act, 1948, as amended in 1956, the assessee-company was entitled to enhance the charges unilaterally subject to the conditions prescribed in the Sixth Schedule to the said Act. The said judgment of the Division Bench of the Gujarat High Court was affirmed by this Court by judgment dated February 26, 1969 in Jindas Oil Mill Ors. v. Godhra Electricity Co.1,. During the pendency of this litigation in the various courts the assessee-company was not able to realise the enhanced charges from the consumers. After the decision of this Court on February 26, 1969 some of the citizens of Godhra met the Minister of Industries, Mines and Power, Government of Gujarat, with a view to persuading him to intervene and restrict the assessee-company from recovering the enhanced rates from the consumers. Thereafter the Under Secretary to the Government of Gujarat in the Industries, Mines and Power Department, addressed a letter dated March 19, 1969 to the assessee-company suggesting that the company may be advised to maintain the status quo for the rates to the consumers are concerned and also to continue the existing street light agreement for at least six months. The Chief Electrical Inspector was requested to go through the accounts of the assessee-company f