COMMISSIONER OF INCOME-TAX, MYSORE, BANGALORE vs THE MYSORE ELECTRICAL INDUSTRIES LTD.

The Supreme Court addressed the computation of capital for surtax purposes under the Companies (Profits) Surtax Act, 1964, specifically interpreting Rule 1 of the Second Schedule. The Court held that sums appropriated by the Directors towards reserves must be included in the capital computation as of April 1, 1963, as they are considered part of the company's reserves. The judgment clarified the definitions of 'chargeable profits' and 'statutory deductions' under the Act, affirming the applicability of these provisions to the case at hand.