Railways Act 1921

11 Composition of claims in respect of Government possession of railways.

(1) The Minister shall, out of moneys to be provided by Parliament, place on deposit with Messrs. Glyn, Mills, Currie and Company, bankers in the city of London, the sum of sixty million pounds to the credit of a deposit account entitled " The Railways Compensation Account," and that sum shall be payable by two equal instalments of thirty million pounds each, of which the first instalment shall become due on the thirty-first day of December, nineteen hundred and twenty-one, and the second instalment shall become due on the thirty-first day of Decembel, nineteen hundred and twenty-two, and each such instalment shall be paid within fifteen days after it so becomes due.

(2) The payment of the said sum shall be a full discharge and in satisfaction of all claims which might otherwise have been made by any railway company in Great Britain to which this section applies for compensation under the [34 & 35 Vict. c. 86.] Regulation of the Forces Act, 1871, the [9 & 10 Geo. 5. c. 50.] Ministry of Transport Act, 1919, or otherwise arising out of or in respect of the possession by the Crown of the undertaking, railroad, or plant of such railway company or the exercise of the powers conferred by those Acts :

Provided that the rights and liabilities of the Crown or the Minister on the one hand, and of the railway companies on the other hand, under the terms of the agreements or arrangements relating to the possession by the Crown of the railways, shall, so far as regards the making good of any deficiency in the net receipts of the companies (including the payment of interest) up to the end of the period of possession, and in relation to any sums expended and liabilities incurred by the companies in respect of repairs and renewals effected before the end of that period in accordance with the said agreements and arrangements, subsist and continue.

(3) The moneys so placed to the credit of the said account in accordance with the provisions of this section, together with any interest which may accrue thereon, shall, subject to the provisions of the next succeeding section, be distributed amongst the railway companies in Great Britain to which this section applies, in accordance with such scheme or schemes of allocation as may be agreed to by such companies, or, failing agreement, as may be settled from time to time by the amalgamation tribunal, and the amalgamation tribunal shall on request issue under their seal a certificate authenticating any such scheme or schemes as may have been agreed or settled, and Messrs. Glyn, Mills, Currie and Company shall pay to each of the said companies forthwith the amount or amounts allocated to such company in accordance with any such scheme bearing the seal of the amalgamation tribunal, and any sum allocated to any company under any such scheme shall be deemed to become, or to have become, due to the company on the date on which the instalment out of which the sum is payable becomes or became due.

(4) All moneys received by any of the said railway companies in pursuance of any such scheme of allocation may be applied in such manner and in such proportions and at such time or times as the directors of the company may determine as a reserve fund for meeting contingencies, or for repairing improving or maintaining any of the property of the company, or for payment of interest or dividend, or for any other purpose for -which the earnings of the company may be properly applied.

(5) Notwithstanding anything in the Income Tax Acts, any sum received by a railway company out of the said account shall not be charged to income tax except so far as any part thereof may, at any time, be applied for the payment of interest or dividends, and the amount so applied shall be assessed and charged to income tax for the year of assessment next following the end of the year or period in respect of which such interest or dividends were paid:

Provided that, if the total amount so applied by the railway companies for the payment of interest and dividends in respect of the three years nineteen hundred and twenty-one, nineteen hundred and twenty-two, and nineteen hundred and twenty-three is less than thirty million pounds, the deficiency (that is to say, the amount representing the difference between the said total amount and the sum of thirty million pounds) shall be assessed and charged to income tax for the year 1924-25.

(6) For the purpose of such assessment, the deficiency shall be apportioned in manner hereinafter mentioned amongst such of the railway companies as have applied for the payment of interest and dividends in respect of the said three years less than one-half of the amount received by them out of the said account, and each such company shall be assessed and charged to income tax on the amount so apportioned to it:

Provided that, where any company so assessed applies for the payment- of interest or dividends in respect of any year subsequent to the year nineteen hundred and twenty-three any part of the sums received by it from the said account, so much of the amount so applied as is equal to the amount for which the company was assessed under the foregoing provisions of this subsection shall not be charged to income tax.

(7) For the purposes of such apportionment, there shall, in the case of each of the companies amongst which the deficiency is to he apportioned, he deducted from one-half of the sum received by the company out of the said account the amount applied by that company for the payment of interest and dividends in respect of the said three years; and the deficiency shall be apportioned amongst the several companies in proportion to the amounts of the several residues so obtained.

(8) After an amalgamation scheme comes into operation, any sums received out of the said account, and any amounts applied for the payment of interest or dividends, by a constituent or subsidiary company in the group to which the scheme relates, shall, for the purposes of this section, be treated as having been so received or applied by the amalgamated company formed by the scheme.

(9) All assessments to income tax in respect of sums applied for the payment of interest or dividends, or in respect of an apportioned share of the deficiency under this section, shall be made by the special commissioners of income tax; and the amount of any such assessment shall be paid, collected, and levied in like manner as any other assessment made by the special commissioners.

(10) The railway companies to which this section applies are the railway companies of whose undertakings possession is retained under the Ministry of Transport Act, 1919, up to the end of the period of possession; that is to say, the period, ending on the fifteenth day of August, nineteen hundred and twenty-one, during which possession of those undertakings is under the said Act authorised to be retained by the Minister.