Judgment

DAS J.: This is an appeal, by special leave granted by this Court, from the judgment and order pronounced by the High Court of Judicature at Bombay on the 22nd March 1950 on a reference (I. T. Reference No. 30 of 1947) made by the Income-Tax Appellate Tribunal at the instance of the appellant under section 66(1) of the Income-tax Act (XI of 1922).

2. The facts necessary to be stated for the purpose of disposing of the present appeal are these: The Royal Estern India Turf Club Ltd. (hereinafter referrd to as the "Company") was incorporated in 1925 under the Indian Companies Act, 1913. The objects for which the company was incorporated were, inter alia , as follows:

(a) To take over the assets, effects and liabilities of the ten unincorporated club known as the Western India Turf Club;

(b) to carry on the business of a Race Course Company in all its branches......;

(c) to establish any clubs, Hotels and other conveniences in connection with the prperty of the company;

(d) to carry on the business of Hotel Keepers, Tavern Keepers, licensed victualiers and refreshment purveyors;

(e) to sell, improve, manage, develop, lease, mortgage, dispose of or otherwise deal with all or any part