Malik, C.J. - (1.) The facts of this case are very simple. The assessee, Mishri Mal Gulab Chand, is a Hindu undivided family doing business at Beawar, Ajmer-Merwara. The relevant assessment year is 1944-45. In the relevant account year, the assessee was a resident and ordinarily resident in British India. The asses-see had speculated individually and in partnership in various commodities in British India and also in Indian States. From its individual business carried on in British India the assessee had made a profit of Rs. 38,473, while from its individual business in the Indian States it suffered a loss of Rs. 25,391. In computing total income from business of the assessee the Income-tax Officer did not debit the loss suffered in Indian States. This decision was upheld by the Assistant Income-tax Commissioner. On appeal the Appellate Tribunal reversed the decision of the Income-tax Commissioner and held that the first proviso to Section 24 (1) of the Act did not apply. On an application made by the Incometax Commissioner the Tribunal has made this reference on two points. 1. Whether in the circumstances of the case the sum of Rs. 25,391 should have been ignored in determining the assessee's income from business in the previous year relevant to the assessment year 1941- 45, or whether that sum should have been deducted from the assessee's income from business in the previous year relevant to the assessment year 1944-45 ? 2. Whether the first proviso to Section 24 (1), Income-tax Act could apply to assessments made for the year 1944-45?
(2.) The second question was referred to us at the instance of the assessee as the account year 1943-44 ended on 31st of March, 1944 and the first proviso to Section 24 (1) did not come into force till 12th April 1944.
(3.) Taking up the second question first, the point appears to me to be concluded by the decision of their Lordships of the Judicial Committee in Maharajah of Pithapuram v. Commissioner of Income-tax, Madras, 1945-13 I. T. R. 221. (A. I. R. (32) 1946 P. C. 89).;