Ajit K. Sengupta, J. - (1.) In this reference under Section 256(1) of the Income-tax Act, 1961, for the assessment year 1983-84, the following question of law has been referred to this court : "Whether, on the facts and in the circumstances of the case, the Tribunal is justified in law in holding that the assessee is entitled to exemption under Section 11 of the Income-tax Act ?"
(2.) The facts are in a narrow compass. The assessee is a public charitable trust. The accounting year relevant to the assessment year 1983-84 ended on September 30, 1982. The assessee invested its assets in shares of private companies. The assessee failed to produce evidence that the assets were converted into specified investments before November 30, 1983, as required by the provisions of Section 13(1)(d) read with Section 11(5) of the Income-tax Act, 1961. Therefore, the Income-tax Officer denied exemption under Section 11 of the Income-tax Act. The Income-tax Officer was of the view that the amended provisions of the above section came into force with effect from April 1, 1983, and that the said provision is applicable to the assessment year 1983-84. The assessee, being aggrieved by the order of the Income-tax Officer, went in appeal before the Appellate Assistant Commissioner. The Appellate Assistant Commissioner held that the amended provisions should apply only for the accounting year after November 30, 1983. Therefore, he directed the Income-tax Officer to allow exemption to the assessee under Section 11 of the Income-tax Act. The Revenue, being aggrieved by the order of the Appellate Assistant Commissioner, brought the dispute before the Tribunal. It was contended on behalf of the Revenue that the provisions relating to the investment of trust funds take effect from April 1, 1983, and, accordingly, the same were applicable to the assessment year 1983-84 and subsequent assessment years. The assessment year involved in this reference application is 1983-84.
(3.) The Tribunal, following its earlier order in the case of Karam Chand Thapar Memorial Trust for the assessment year 1983-84, held that the assessee was eligible for exemption in spite of the amendment of Section 13(1)(d) read with Section 11(5) of the Act.;