FOREIGN COMPANIES UNDER THE INDIAN COMPANIES ACT . . 214 THE MINING LAW OF MEXICO 219 By Henry P. Crawford. LAWS AFFECTING COMMERCE, 75TH CONGRESS, 3RD SESSION. Subscription: $1 a year; single copies, 10 cents. Make remittances only to Superintendent of Documents, Washington, D. C. Published with the approval of the Director of the Budget IMPORTANT NOTICE COMPARATIVE LAW SERIES, A World Review of Laws Affecting American Commerce Abroad, edited by the staff of the Division of Commercial Laws, Bureau of Foreign and Domestic Commerce, United States Department of Commerce, took a new form and size with the April issue. Accompanying this change there was also a change in the method of distributing subscription copies. Formerly made by the Bureau, the distribution is now handled directly from the Government Printing Office. The annual subscription price of $1.00 per year (in advance) remains the same. New and renewal subscription remittances should be made payable to the Superintendent of Documents, and forwarded to that official at the Government Printing Office in Washington, D. C., or submitted through any of the District and Cooperative offices of the Bureau of Foreign and Domestic Commerce, located in principal cities. INCOME TAXATION IN BRITISH INDIA By J. H. Barkmeier, Division of Commercial Laws Income tax is levied in British India under the Income Tax Act of 1922 as amended to 1938. This Act applies only to British India proper and not to the protected and feudatory States which have their own sources of revenue, but the laws of those Indian States levying an income tax are generally modeled on the British Indian act, although the rates may vary. The British Indian rates are fixed by the annual finance acts. Income tax is generally collected by direct assessment against the recipient of the income. The two principal exceptions are in the case of salaries which are taxed by deduction by the employer on the basis of estimated rates, and interest from securities on which the tax must be withheld by persons paying such interest at the maximum rate unless a certificate is issued by the tax officials permitting a lower rate to be deducted. The taxes withheld are credited to the taxpayer and are subject to adjustment on the filing of a return for direct assessment. The tax officials may also require the withholding of tax on the income of nonresidents by any person within British India having assets of the nonresident. A supertax is also levied on companies on that part of the income exceeding 50,000 rupees and on individuals on the excess over 30,000 rubees. The supertax is always payable by direct assessment, except that withholding may be required in the case of nonresidents where it is believed that the income will exceed the exemption limits. LIABILITY OF NONRESIDENTS The liability of nonresidents to tax on profits derived in British India is defined by Sections 42 and 43 which read as follows: 42. (1) In the case of any person residing out of British India, all profits or gains accruing or arising, to such person, whether directly or indirectly, through or from any business connection or property in British India, shall be deemed to be income accruing or arising within British India, and shall be chargeable to income tax in the name of the agent of any such person, and such agent shall be deemed to be, for all the purposes of this Act, the assessee in respect of such income tax: Provided that any arrears of tax may be recovered also in accordance with the provisions of this Act from any assets of the nonresident person which are, or may at any time come within British India. (2) Where a person not resident in British India, and not being a British subject or a firm or company constituted within His Majesty's dominions or a branch thereof, carries on business with a person resident in British India, and it appears to the Income Tax Officer or the Assistant Commissioner, as the case may be, that owing to the close connection between the resident and the nonresident person and to the substantial control exercised by the nonresident over the resident, the course of business between those persons is so arranged, that the business done by the resident in pursuance of his connection |