CHAGLA, C.J. :- The main question that arises for our decision on this reference is whether the assessee company is a company to which S. 23A applies. The facts briefly are that the share-capital of the company consisted of 1 lakh Ordinary Shares of Rs. 10/- each aggregating to Rs. 10,00,000/-, 5,000 Cumulative Preference Shares of Rs. 25/- each aggregating to Rs. 1,25,000/-, and 4,000 Second Preference Shares of Rs. 100/- each aggregating to Rs. 4,00,000/-. All the shares were fully paid up.

2. Now, under S. 23A what has got to be considered is the voting power and it is clear from the provisions of S. 23A, as it stood at the relevant date, that the only shares that we have to consider are the Ordinary Shares. The position with regard to the Ordinary Shares was this. Seven Directors between themselves held 35,469 Ordinary Shares. These Directors were also partners in the managing agency firm of Mangaldas Mehta and Co. which managed the assessee company. The managing agency firm consisted of 14 partners, seven of them being the Directors, and the other seven partners held between them 41.859 Ordinary Shares. 9,899 Ordinary Shares were held by persons who were represented by