- (1.) The question which arises for consideration in this appeal is as to in which assessment year is the appellant liable to be assessed in respect of mesne profits which were awarded in his favour. Briefly stated the facts, as found by the Tribunal, are that the appellant had agreed to purchase a title factory vide written agreement dated 22nd May, 1950. When the vendor did not convey the property, as promised, the appellant filed a suit for specific performance. This suit was ultimately decreed in appeal by this Court vide its judgment dated 22nd April, 1958. In terms of this decree the appellant was required to deposit Rs. 85,000/- within 30 days of the decree and thereupon the title in the property was to be conveyed to the appellant. This Court also passed a decree declaring that the appellant was entitled to mesne profits against the respondent therein and in connection therewith the decree of this Court stated as follows : "AND THIS COURT DOTH ACCORDINGLY DIRECT that the trial Court do hold an enquiry about the mesne profits, and such sums as may be found to be due on inquiry against the second and third respondents in respect of the mesne profits be deducted from the amount to be deposited in cash in the Court by the appellant aforesaid in accordance with clause (a) supra, and do direct the payment of the remaining amount, if any, to the third respondent who is the assignee of the second respondent pendente-lite;"
(2.) It is not in dispute that the trial Court went into the matter and determined the quantum of mesne profits by its order dated 22nd December, 1962 relevant to the assessment year 1963-64. The amount of mesne profits which was determined at Rs. 57,093/- was received by the appellant by the following accounting year relevant to the assessment year 1964-65.
(3.) The Income-tax Officer assessed this sum of Rs. 57,093/- in the appellant's assessment year 1963-64. On appeal, the Assistant Commissioner, however, deleted this amount as in his opinion the same could be taxed only in the year 1964-65. On further appeal the Tribunal came to the conclusion that this sum was taxable only in the assessment year 1963-64. Thereupon, at the instance of the assessee, the Tribunal referred the following two questions of law to the High Court of Madras : "1. Whether the mesne profits decreed by the Supreme Court accrued to the assessee earlier to the accounting year relevant to assessment year 1963-64 2. Whether on the facts and in the circumstances of the case, the mesne profits received by the assessee is liable to be taxed in the assessment year 1964-65 -;