B.P.Jeevan Reddy, C.J. - (1.) Under Section 256(1) of the Income-tax Act, 1961, the Tribunal has stated the following question : "Whether, on the facts and in the circumstances of the case, the Appellate Tribunal was justified in law in holding that the receipt of Rs. 15,000 by the assessee for the surrender of its tenancy of the godown in question was a capital gain and not a causal receipt and tax was computable thereon under the Income-tax Act, 1961, accordingly ?"
(2.) The assessee is an individual. It carries on the business of pawning and dealing in shares. The assessment year concerned is 1976-77. During the relevant previous year, the assessee received an amount of Rs. 15,000 by way of consideration for surrendering the tenancy of a godown occupied by him as a tenant. The godown belonged to Badri Prasad Agrawal who sold the same to one Smt. Navnita Chatterji. Smt. Navnita Chatterji paid the said amount to the assessee to get the premises vacated. In the return filed by him, the assessee disclosed the said amount as a capital gain. Later, however, he contended before the Income-tax Officer that it was not at all taxable not being a revenue receipt. The Income-tax Officer rejected this contention and held it to be a casual receipt within the meaning of Section 10(3) of the Act. Accordingly, he exempted a sum of Rs. 1,000 and brought the remaining Rs. 14,000 to tax. On appeal, the Appellate Assistant Commissioner agreed with the Income-tax Officer. On further appeal, however, the Tribunal took the view that the said amount represented a capital gain. It disposed of the appeal with the following directions : "The result is that even though the interpretation put on behalf of the assessee on the provisions of Section 10(3) is not accepted, the position under Section 45 remains and to this extent the order of the lower authorities is not justified, and the Income-tax Officer will treat this receipt as a capital gain and compute the tax ..."
(3.) Thereupon, the Revenue applied for and obtained this reference. Of course, no reference has been asked for by the assessee. The assessee's counsel explains that he did not ask for a reference for the reason that the Tribunal merely directed the Income-tax Officer "to compute the tax in accordance with law" and that as and when the Income-tax Officer takes up the matter, he would contend that the said amount cannot be brought to tax under Section 45 read with Section 48 for the reason that there is no cost of acquisition of the said asset, i.e., tenancy. Be that as it may, we would proceed now to answer the question referred to us. Section 10 occurs in Chapter III which deals with "incomes which do not form part of total income". Section 10 carries the heading "Incomes not included in total income". In so far as it is relevant, Section 10 reads thus : "10. Incomes not included in total income.--In computing the total income of a previous year of any person, any income falling within any of the following clauses shall not be included (1) agricultural income ; (2) subject to the provisions of Sub-section (2) of Section 64, any sum received by an individual as a member of a Hindu undivided family, where such sum has been paid out of the income of the family, or, in the case of any impartible estate where such sum has been paid out of the income of the estate belonging to the family ; (2A) omitted ; (3) any receipts which are of a casual and non-recurring nature, to the extent such receipts do not exceed five thousand rupees in the aggregate : Provided that this clause shall not apply to (i) capital gains chargeable under the provisions of Section 45 ; or (ii) receipts arising from business or the exercise of a profession or occupation ; or (iii) receipts by way of addition to the remuneration of an employee ;";