Judgment

SARKARIA, J. :- This appeal by special leave is directed against a judgment, dated July 12, 1971, of the High Court of Delhi. It arises out of these facts :

The appellant (hereinafter referred to as the assessee) is an individual. The assessment year is 1955-1956.

2. Bharat Union Agencies Pvt. Ltd. had spent Rs. 53,398/- after the personal necessities of the assessee during the previous year ending 30-9-1954, without charging for the same. The assessee was not a Director of the said Company. He however was the beneficial owner of 1800 shares out of the total of 3000 equity shares of the said Company during the previous year. Similarly, Allen Berry and Co. Pvt. Ltd. had spent a sum of Rs. 4406/- after the personal necessities of the assessee, without charging for the same.

3. The Income-tax Officer treated the total benefit of Rs. 57,804/- received by the assessee from these two Companies, as his income under Section 2 (6c) (iii) of the Income-tax Act, 1922 which was introduced by the Finance Act, 1955 with effect from 1-4-1955, and charged it to tax along with some other items of income.

4. The assessee carried an appeal to the Appellate Assistant Commissioner who found that th