JUDGMENT

Srikrishna, J.-The assessee is a company registered under the provisions of the Companies Act and carrying on business in agricultural activities and dairy farming. The assessee was subjected to levy of income-tax under section 104 of the Income Tax Act, 1961 ( the Act ) for the assessment years 1974-75, 1975-76 and 1976-77, for its failure to distribute the required statutory percentage of dividend during the concerned previous years ending on 31st March 1973, 31st March 1974 and 31st March, 1975, respectively.

2. The figures of total income-tax assessed and the distributable surplus as computed by the Income-tax Officer for the assessment years 1974-75 and 1975-76, are as under :

Assessment year 1974-75 1975-76

1. Total income Rs. 3,22,580 Rs. 72,130

2. Less taxes

payable thereon. Rs. 2,20,160 Rs. 49,228

3. Distributable

surplus Rs. 1,02,420 Rs. 22,902

4. Dividends that ought

to have been declared

by the company, i.e.

90%  Rs. 92,223 Rs. 20,612

5. Dividend declared

by the assessee

company Nil