- (1.) AT the instance of the Revenue, the Tribunal referred the following question for the opinion of this Court : "Whether, on the facts and in the circumstances of the case, the Tribunal was justified in holding that the amount of Rs. 38,713 had not accrued to the assessee and could not be taxed as its income for the asst. yr. 1975-76?"
(2.) THE facts as stated in the 'statement of the case' are that the assessee realised Rs. 39,713 (correct amount is said to be Rs. 38,713) as a result of increase in the price of fertiliser made by the Government of India w.e.f. 1st June, 1974. The case relates to the asst. yr. 1975-76, previous year for which ended on 31st March, 1975. Later, the Government of UP by means of an Ordinance declared that all dealers in fertiliser shall sell the fertiliser at the old rate in respect of the stock available as on 31st June, 1974. The dealers in fertiliser then filed a writ petition before this Court challenging the validity of the Ordinance, but they failed. On appeal, the Supreme Court by an interim order permitted the dealers to sell the old stock at the prevailing rates subject to the dealers depositing the difference of the amount in the post office accounts pledged to the District Magistrate concerned. During the assessment proceedings, the ITO called upon the assessee to explain as to why the amount of Rs. 38,713 representing the difference in the old and new rate should not be included in its total income. The ITO accepting the case of the assessee did not include Rs. 38,713 in its total income. Thereafter, the CIT initiated proceedings under S. 263(1) of the IT Act, 1961 (briefly, the Act) as he was of the view that non-inclusion of the said amount in the total income of the assessee was erroneous and prejudicial to the interests of the Revenue. After hearing the assessee, the CIT eventually passed an order under S. 263(1) of the Act directing the ITO to include the amount of Rs. 38,713 in the total income of the assessee. The assessee then carried the dispute in appeal before the Tribunal. The Tribunal following its decision in the case of Govind Prasad Prabhu Nath (ITA No. 415/All/1976-77) held that the CIT was not justified in directing the ITO to include the aforesaid amount in the total income of the assessee. This question came up before this Court in CIT vs. Dhruv Prasad Agarwal 1992 UPTC 1279 and then the Court held that the income could be said to have accrued only when the assessee acquired a right to receive that. From the facts of this case, it is clear that the matter was pending before the Supreme Court in appeal. Until decision of the Supreme Court, no right accrued to the assessee to receive the amount as income and, therefore, following the aforesaid decision, we hold that the Tribunal was right in holding that the CIT was not justified in directing the ITO to include the amount of Rs. 38,713 in the total income of the assessee. The above mentioned question is, therefore, answered in the affirmative, that is, in favour of the assessee and against the Revenue.;