Ajit K.Sengupta, J. - (1.) In this reference under Section 256 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 was correct in law in holding that interest on debentures did not accrue or become due during the relevant accounting year and, therefore, it was not assessable in the assessment year 1983-84 ?"
(2.) Briefly stated the relevant facts of the case are that during the course of assessment proceedings, the Assessing Officer found that the assessee had not disclosed income on account of interest on debentures of Messrs. Bird and Co., and Messrs, Kumardhubi Engg. Works Ltd. although it was found that in the assessment orders for the earlier years such interest on debentures was taken on due or accrual basis. The explanation furnished by the assessee that it had lodged its claim with the prescribed authorities and as on the last date of the accounting year no decision had been taken and, therefore, interest on debentures was not taxable in the year under reference, had not been accepted by the Assessing Officer. Accordingly, he added Rs. 53,858 to the total income of the assessee-company.
(3.) On appeal by the assessee, the Commissioner of Income-tax (Appeals), after considering the facts of the case and the arguments advanced on behalf of the assessee and the appellate order of the Tribunal in the assessee's own case for the assessment year 1980-81 took the view that the interest on debentures of the above two companies did not accrue to the assessee during the previous year relevant to the assessment year 1983-84.;