Sankar Prasad Mitra, J. - (1.) In this reference under Section 66(2) of the Indian Income-tax Act, 1922, we have to answer the following question of law: " Whether, on the facts and in the circumstances of the case, the Tribunal was right in holding that relief should be given to the assessee on its Pakistan business income in accordance with the provisions of the Agreement for Avoidance of Double Taxation between the Government of India and Pakistan without setting off against it the loss in agricultural operations in Pakistan ? "
(2.) The assessment year is 1956-57. The financial year is the year ending on June 30, 1955. Messrs. Carew & Co. Ltd., the respondent herein, is resident in India having its registered office in Calcutta, Its sources of income are from : (a) business in India and interest earned in India on securities, (b) manufacturing business in Pakistan and (c) agricultural properties in Pakistan.
(3.) For the relevant year the respondent's Indian income as computed by the Income-tax Officer was Rs. 2,01,329 from business and Rs. 373 from interest on securities. The total of the two items was Rs. 2,01,702. The Pakistan income was computed by the Income-tax Officer in the assessment year as follows: JUDGEMENT_459_ITR87_1973Html1.htm;