1975 (8) TMI 4

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....es to the assessment year 1960-61 and Rs. 46,560 as dividend on March 15, 1961, which relates to the assessment year 1961-62. These two sums were assessed as capital gains under section 12B of the Indian Income- tax Act, 1922, and under section 46(2) of the Income-tax Act of 1961, respectively, in the hands of the assessee in these two assessment years by the Income-tax Officer. The appeal filed by the assessee was dismissed by the Appellate Assistant Commissioner. The Tribunal has, however, allowed the second appeal filed by the assessee and has referred the following questions to this court " (1) Whether, on the facts and in the circumstances of the case, the sums of Rs. 39,519 and Rs. 46,560 were properly assessed as capital gains wit....

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....ss Rs. 46,560 under section 46(2) read with section 297(2)(b) of the Income-tax Act, 196 1. To appreciate his contention it is necessary to state a few facts. The assessment year 1961-62 ended on March 31, 1962, and this sum was received by the assessee on March 15, 1961, that is to say, in assesssment year 1961-62, as already stated. The Income-tax Act of 1961, which repealed the Indian Income-tax Act, 1922, came into operation on 1st April, 1962, and, thereafter, the assessee filed his return of income for the assessment year 1961-62. Now, section 46(2) of the Income-tax Act, 1961, reads as follows : Where a shareholder on the liquidation of a company receives any money or other assets from the company, he shall be chargeable to inc....

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.... must be applied, vide Commissioner of Income-tax v. Isthmian Steamship Lines [1951] 20 ITR 572 (SC) and Maharaja of Pithapuram v. Commissioner of Income-tax [1945] 13 ITR 221 (Pt). The substantive law of that year was section 12B of the Indian Income-tax Act, 1922, and not section 46(2) of the Income-tax Act, 1961. This receipt could not be brought to tax if the return was filed before 1st April, 1962. It was not even chargeable to tax and it cannot be brought to tax merely because the return was filed after 1st April, 1962. It has been rightly contended on behalf of the assessee that to accept the contention of Mr. B. L. Pal is to amend section 12B of the Indian Income-tax Act, 1922, by section 46(2) of the Income-tax Act, 1961, wit....