R.R. Misra, J. - (1.) The Income-tax Appellate Tribunal, Allahabad Bench, Allahabad, has referred the following question of law for the opinion of this court : " Whether, on the facts and in the circumstances of the case, the Tribunal was right in holding that the amount of Rs. 1,07,957 had not accrued to the assessee and could not be taxed as its income for the assessment year 1975-76 ? "
(2.) The relevant facts are as under :
(3.) The assessee is a firm selling chaff-cutting machines at its head office and fertilizer at its branch at Sultanpur. The dispute relates to the assessment year 1975-76, The accounting year of the assessee for the said assessment year was the financial year 1974-75. During the said accounting year, the assessee had maintained its accounts on the mercantile basis. During the course of scrutiny of the account books, the Income-tax Officer noticed that the assessee had deposited Rs. 1,07,957 in a post office savings bank account which had been pledged to the District Magistrate, Sultanpur. In reply to the queries put by the Income-tax Officer, the assessee replied that the selling price of fertilizer was raised by the Government of India with effect from June 1, 1974, Later on, the U.P. Government, however, issued an Ordinance saying that the stock of fertilizer which the dealers held as on May 31, 1974, will have to be sold at the old rates. The fertilizer dealers, however, challenged this Ordinance of the U.P. Government unsuccessfully before the High Court. Aggrieved against the said judgment of the High Court, the dealers filed an appeal before the Supreme Court. In the appeals as filed by the said fertilizer dealers, the Supreme Court passed the following interim order on September 23, 1974 : "Sale of fertilizers may be made by the appellants-petitioners on permits issued by the Officer concerned at the new rates. The excess price in respect of the fertilizers which were in possession of the appellants before 1st June, 1974, should be deposited by the appellants with the District. Magistrate concerned within a fortnight after the sale. The amount shall remain in deposit in a separate account (with the District Magistrate). The appellants undertook to maintain the accounts in respect of such sales. ";