HARI PRASAD JAYANTILAL & CO. LTD. vs INCOME-TAX OFFICER, SPECIAL INVESTIGATION CIRCLE-B.

The Supreme Court held that under Section 35(10) of the Income-tax Act, 1922, the Income-tax Officer has the authority to withdraw tax rebates within four years from the end of the financial year in which the rebate was granted. The Court ruled that the distribution of accumulated profits by a liquidator during voluntary winding up constitutes a declaration of dividend, thus making the provisions for tax withdrawal applicable. The appeal was dismissed, affirming the High Court's decision that the liquidator's actions are treated as those of the company itself in terms of dividend distribution.