M/S George Williamson (Assam) Ltd vs Commissioner Of Income Tax, Guwahati

The Supreme Court addressed the interpretation of Explanation 1 to Rule 2 of the Second Schedule to the Companies (Profits) Surtax Act, 1964, in the context of a company's acquisition of Indian undertakings of several sterling tea companies. The Court held that the approval from the Reserve Bank of India under Section 19(1)(d) of the Foreign Exchange Regulation Act, 1973, was valid and that the appellant company was required to maintain net assets as per the RBI's directive. The judgment of the Gauhati High Court was reversed, affirming the appellate tribunal's decision regarding the assessment of the appellant company under the Surtax Act.