Lord Macmillan-

For the years 1925-26 and 1926-27 assessment to income-tax and super-tax under the Income-tax Act, 1922 (11 of 1922) were made on "the Agent, Pondicherry Ry. Co. Ltd., Trichinopoly" in respect of the income derived by the company from its business. On appeal these assessments were confirmed by the Assistant Commissioner of Income-tax, Southern Range, Madura. The assessee thereupon under S. 66 (2) of the Act required the Commissioner of Income-tax for the Province of Madras to refer to the High Court of Judicature at Madras certain questions of law arising with regard to the validity of the assessment. The Commissioner accordingly stated a case in which he referred for the decision of the Court four questions of law, three only of which it is necessary to set out here viz.:

"(b) Whether the Pondicherry Ry. Co. Ltd. which is resident without British India is liable to be assessed to income-tax on the income derived by it from the working of the Pondicherry Railway under S. 4, Income-tax Act as income accruing or arising or received in British India?'

(c) Whether the Pondicherry Ry. Co. Ltd. carries on business in British India within the meaning of the Income-tax Act ? a