Viscount Simon. -

This appeal from a judgment of the Rhodesian Court of Appeal which affirmed a judgment of the High Court of Northern Rhodesia, raises the question whether certain additional assessment to income-tax made in Northern Rhodesia upon the appellant company, the British South Africa Company, for the years ending 31st March 1938, 1939 and 1940, were validly made and ought to be upheld. Inasmuch as the issue in their Lordships opinion ultimately turns upon the nature of the business carried on by the company and of the receipts, in respect of which the assessments in question were made, a consideration of the company's history and of its transactions in relation to these receipts is necessary. The company was incorporated by Royal Charter on 29th October 1889. The Charter recites the petition by the Duke of Abercora and others associated with him for incorporation and that the existence of a powerful British company controlled by Her Majesty's subjects in whom she had confidence and having its principal field of operations in that region of South Africa lying to the north of Bechuanaland and to the west of Portuguese East Africa would be advantageous to the commercial and other interests of Her Majesty's subjects in the United Kingdom and the colonies and that the petitioners desired to carry into effect divers concessions and agreements which had been made by certain of the chiefs and tribes inhabiting the said region and such other concessions, agreements, grants and treaties as the petitioners might thereafter obtain within the said region or elsewhere in Africa with the view of promoting trade, commerce, civilisation and good government as therein mentioned, and that the success of the enterprise in which the petitioners were engaged would be greatly advanced by a Royal Charter of Incorporation.

By cl. 2 of the Charter the company was authorised and empowered to hold, use and retain for the purposes of the company and in the terms of the Charter the full benefit of the concessions and agreements made as aforesaid so far as they were valid, or any of them and all interests, authorities and powers comprised or referred to in the said concessions and agreements. Other clauses gave the widest administrative powers to the company and cl. 24 gave it special authority (v) to carry on mining and other industries and to make concessions of mining, forestal or other rights, and (xii) to carry on any lawful commerce, trade, pursuit, business operations or dealing whatsoever in connection with the business of the company. The charter contemplated that the objects of the company would be further defined by a Deed of Settlement. Such a deed was executed on 3rd February 1891, and it was by its third article declared that the company was formed inter alia: (2) to undertake and carry on the government or administration of any territories, districts or places in Africa, and therefor and therein to make laws and ordinances, and to impose and levy taxes, and raise revenue, and to establish and maintain a force of police; (8) to provide for and promote the welfare of the inhabitants of Africa, the advancement of civilization, and the development of trade; (4) to negotiate and carry into effect treaties and arrangements with any Chiefs, Rulers, Governments or Authorities (Supreme Local or otherwise) in Africa and elsewhere; and to subsidize any such Chiefs, Rulers, Governments or Authorities; (6) to prospect explore examine and investigate countries territories places undertakings properties and claims of all kinds, and to organize conduct assist and subsidize expeditions surveys investigations experiments and testing operations of all kinds, and to collect train employ and furnish experts for any such purposes; (7) to form organize promote subsidize and assist companies syndicates partnerships institutions and associations for any purposes conducive to the interests of the company, and to hold shares in any company or corporation.

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