TaxTMI 
TaxTMI 
1980 (11) TMI 82
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....d to as "the Company") was set apart and deposited with the Company on 11th Aug., 1919 in the name of Dewan Bahadur Ummedmal, Biradmal and Kanmal, members of the assessee HUF. This amount was set apart with the object of founding an educational institution at Ajmer. Interest @ Rs. 0-7-9 per cent. Was payable and was used to be paid by the Company on the said deposits. The deposit and the interest accumulated thereon continued with the Company. Some time in November or December, 1938, Shri Gadhmal Gumanmal Lodha, who was working as Chairman and Managing Agent of the Company, who was also a member of the assessee family, purchased out of the said accumulated funds 9 Howrah Bridge Loan Debentures of Rs. 5,000 each and 5 Promissory Notes of Rs.....
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..... 11th Jan., 1964 the ITO took the view in the assessee's case pertaining to the asst. yr. 1965-66 that the interest amount of Rs. 64,900 was chargeable to tax. The working of the interest of Rs. 64,900 is not known, but it is not disputed that the said amount had been received by the assessee from the Company towards interest. The inclusion of Rs. 64,900 in the assessment relating to the asst. yr. 1965-66 was challenged by the assessee right upto the stage of Tribunal. It was found by the Tribunal that the sum of Rs. 64,900 could not be brought to tax in the asst. yr. 1965-66. Therefore, the ITO took action under s. 147(a)r/w s. 151(1) and explanation to s. 153 and re-opened the assessment for the asst. yr. 1964-65. He, then added the sum ....
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....ancial year 1963-64 and to include in the computation of the assessee's total income for the asst. yr. 1964-65 only such amount in place of the sum of Rs. 64,900. 3. Being aggrieved, the assessee as well, as the Revenue both have come up in appeals before the Tribunal. It is noteworthy that neither did the assessee, nor did not the Revenue urge before the CIT (A) at any stage that the assessee was assessable in respect of such income on receipt basis. So the common attack of both parties before us that the CIT (A) was in error in holding that the interest income arising on the family deposits was assessable on the receipt basis. Since it was not the case of either party that the interest was assessable on receipt basis, we hold that the ....
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....nary and the order becomes final only by virtue of the final decree and, therefore, the income accrued to the assessee only during the year in which the final decree was passed. Shri Garg, the ld. Departmental Representative also submits before us that after the preliminary decree was passed, the Commr. was appointed and that the dispute about the rate of interest continued after the preliminary decree and to that effect the objections were filed by the assessee. It is argued that the assessee contended that compound interest should have been calculated by the Commr. and not the simple interest and that such objection was over looked by the Court. Whether there should be a compound interest or simple interest-this question, according to the....
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....ree and based thereon. Sec.97 of the Code Civil Procedure clearly precludes the parties aggrieved by a preliminary decree who do not appeal from such decree within the period of limitation, from afterwards disputing its correctness in an appeal which may be preferred from the final decree. From this, it is clear that preliminary decree has a binding force and it cannot be equated with any interlocutory order. Final decree is merely in its nature defendent and subordinate and any appeal preferred against the final decree will come to an end the moment the preliminary decree is set aside. We, therefore, do not agree with the contention of the Revenue that the issue was finally determined only by the final decree and not by the preliminary dec....
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.... clear that the Court settled the controversy by means of the preliminary decree dt. 24th Oct., 1960 and at best the amount could be brought to tax in the year in which the preliminary decree was passed. It was also argued before us that assessee admitted before the Tribunal during the hearing of the appeal pertaining to the asst. yr. 1965-66 that the amount was assessable in the year 1964-65. This contention is not correct. Extract from the order of the Tribunal for the asst. yr. 1965-66 is included in the paper book and a perusal thereof clearly shows that no admission was made by the assessee that the income had accrued in the previous year relevant to the asst. yr. 1965-66. The Tribunal while disposing of the appeal relating to the asst....