THE COMMISSIONER OF INCOME-TAX,BOMBAY CITY vs THE KHATAU MAKANJI SPINNING ANDWEAVING CO. LTD., BOMBAY.

The Supreme Court held that the additional income-tax imposed under the Indian Finance Act, 1953, was not validly charged as it did not align with the definition of 'total income' under Section 3 of the Indian Income-tax Act, 1922. The Court affirmed the High Court's ruling that the Finance Act's provisions exceeded its intended purpose by taxing accumulated profits not deemed as part of the total income for the previous year. Consequently, the appeal by the Commissioner of Income-tax was dismissed, upholding the High Court's negative response to the question of legality regarding the additional income-tax.