JUDGMENT - Chagla, C.J.

2. This reference raises a very important and a very interesting question as to the interpretation of Section 23-A, Income-tax Act. The facts leading up to the reference may be briefly stated. The assessee is the legal representative of Mafatlal Gagalbhai and he has been assessed in that capacity. The assessment order against him for the assessment year 1942-43 was passed on 28-2-1946, and with regard to the assessment year 1943-44 it was passed on 23-8-1946. It appears that Mafatlal was a share-holder in the Gagalbhai Jute Mills, Ltd., and as such share-holder he held 12,185 ordinary shares and 2,500 preference shares. The Income-tax Officer made an order in respect of this company under Section 23A on 20-2-1947, and by that order he directed that Rs. 5,71,072 and RS. 10,00,411 for the two respective years ending on 31-3-1941, and 31-3-1942, should be distributed as dividend to the share-holders who were share-holders at the date when the relevant general meeting of the company was held.

In consequence of this order the Income-tax Officer reopened the assessment of the assessee for the assessment year 1942-43 and 1943-44 and he included in the assessment year

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