LexCENTRAL COAL FIELDS LTD. ETC. versus BHUBANESWAR SINGH & ORS.
Open in Lexace · Ask the AI about this caseJudgment (excerpt)
A
B
c
D
E
F
G
H
618
CENTRAL COAL FIELDS LTD. ETC.
v.
BHUllANESWAR SINGH & ORS.
23rd August, 1984
(P.N. IlHAGWATI, AMARENDRA NATH SEN AND
RANGANATH MISRA. JJ.]
Coking Coal Mines
~Nationalisation) Act, 197 I-Section 21 (2)-Whether
value of stock of coking coal on April 30, 1972 should be taking into account for
determining aniount payable to owner under s. 21 (2)-Held: yes.
The management of a coal mine owned by Respondent No. 1, a partner-
ship firn1, was taken over by the Central Govcrnn1ent with effect from
October 17, 1971 under the Coking Coal Mines (Emergency Provisions) Ordi*
nance of 1971 which was later replaced by a statute. On the passing of the
Coking Coal Mines (Nationalisation) Act, 1971 ('Nationalisation Act' for
short) the right, title and interest of the owner in the mine extinguished and
became vested in the Central Governn1ent with efftct from May 1, 1972.
Section 21 (2) of the Nationalisation Act provided that in addition to the sum
referred to in sub-s. (1), the Central Government shall pay such a1nount as
may become due to the owner of a coking coal mine---in relation to the
period during which the managetnent of the coking coal mine-- remained
vested in the Central Government. In a writ petition filed
before the High
Court it was claimed by the owner that while determining the amount payable
to it or recoverable from it in respect of the period when the mine was under
the management of the Custodian, credit for the value of the stock of coking
coal on April 30, 1972 shown in the account books should have been given to
it. The High Court accepted the claim of the owner. The appel1ants (The
Government Companies) obt~ined special leave to appeal against the decision
of the High Court.
Dismissing the appeals,
HELD : The stock of coal had to be taken into account for balancing
the position. {624HJ
The Nationalisation Act which contemplated the books of account for the
period from October 17, 1971 to April 30, 1972 to be closed and a statement of
account as on Apri I 30, 1972 to be prepared with a view to find out whether the
Government Company which was in management for the relevant period on
behalf of the owner was to pay anything to the owner or the Government
..
•
•
•
•
•
•
..
•
COAL FIELDS v. BHUBANBSWAR SINGH (Rangnath Misra, J.)
619
. Company having spent for the owner was entitled to recover any sum
from the owner, also contemplated preparation of a balance-sheet on that date.
Jn the absence of any particular prescribed mode in the Act or the Coking
Coal Mines (Statement of Account) Rules, 1972 made thereunder, the accounts
and the balance-sheet had to be prepared according to the normal commercial
practice, which necessarily required stock-in-trade to be reflected. [624D-E]
Under the Income-tax Act profits have to be ascertaind for the purposes of
computing tax liability. For computing true profits the value of the stock-in
trade must be taken into account. [624D]
'
Commissioner oflncome-tax-;-Madras v. A. Krishnaswami Mudaliar & Ors.
53 I.T.R. 122 at 130, referred to.
A
B
In the instant case, the appellants accepted the position that if the extracted
C
coal had been sold before the appointed-day, the owner would have been enti-
tled to the price. The mere fact that the extracted coal remained in stock at
the commencement of the appointed date can make no difference to the
position. [624F-G]
Statement 8 in the prescribed statutory form clearly indicates that the
stock as on April 30, 1972, had to be taken into amount.
D
CIVIL APPELLATE JURISDICTION. Civil Appeal Nos.
3374-75 of 1984
Appeals by Special leave from the Judgment and Order dated
the 14th. April, 1983 of the Patna High Court in C.W.J.C. No.
1072 of 1982 (R).
L.N. Sinha, A. Sachthey and R.N. Sachthey fo: the Appellant
in C.A. 3374/84.
L.N. Sinha, S.C. Malik and M.L. Verma for the Appellant
in C.A. 3375/84 .
D. Goburdhan for Respondent in C.A.3374 184.
Shanti Bhushan, D.N. Goburdhan and D. Goburdhan for Respon-
dent in CA. No. 3375 /84.
The Judgment of the Court was delivered by
RANGANATH MISRA, J. Special leave granted .
E
F
G
Respondent No. I, a partnership firm, held a coking coal mine
known as Tariya Colliery within the State of Bihar the mana~ement
If
A
B
c
D
F
ff
620
SUPREME COURT REPORTS
[1985] ! s.C.R
where of was taken over under the Coking Coal Mines (Emergency
Provisions) Ordinance of 1971 with effect from October 17Excerpt shown. Read the full judgment & AI analysis in Lexace.