JUDGMENT

Sen, J.-Leave granted.

2. The amounts in dispute in this case are small and the tax effect is even smaller. We would have declined to go into the dispute at this stage, but for the fact that an interesting question of law is involved.

3. The income tax assessment of M/s. T.V. Sundaram Iyengar & Sons Ltd. for the assessment years 1982-83 and 1983-84 were completed on 1st August, 1984. The Income Tax Officer found that the assessee had transferred an amount of Rs. 17,381/- to the profit and loss account of the company during the accounting period ended on 31st March, 1982 (assessment year 1982-83), and an amount of Rs. 38,975/- during the accounting period ended on 31st March, 1983 (assessment year 1983-84). But these amounts were not included in the total income of the assessee. The sums were stated to be credit balances standing in favour of the customers of the company. Since these balances were not claimed by the customers, the amounts were transferred by the assessee to the profit and loss account. There is no dispute that the amount was received by the assessee in course of trade transactions. The Income Tax Officer was of the view that because the surplus had arisen as a