M/S. GEORGE WILLIAMSON (ASSAM) LTD. vs COMMNR. 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 takeover of Indian undertakings of sterling tea companies. The Court held that the Reserve Bank of India's approval for the acquisition, which mandated no depletion in net assets, was valid and binding. The judgment reversed the Gauhati High Court's decision, thereby upholding the appellate tribunal's order regarding the appellant company's compliance with the stipulated financial requirements.