Judgment

GROVER, J.:- This is an appeal by special leave from the judgment of the Calcutta High Court in an Income-tax Reference in which the question that had to be answered by the High Court was "whether on the acts and circumstances of the case the sum of Rs. 55,200 was a revenue receipt being rent received in advance thus liable to be taxed?"

2. On July 19, 1945, the assessee took on lease premises No. 157 Upper Circular Road, Calcutta for a term of 99 years on a monthly rental of Rs. 750/. It was stipulated inter alia that the lessee could assign the lease with the consent of the lessor. He could alter the structures on the premises so as to convert it into a cinema if necessary. After expending Rs. 35,000/- on some alterations to the premises the assessee felt the necessity of having some more money in order to convert the building into a cinema. He entered into a lease on February 23, 1946 with three persons, namely, Nani Gopal Dutt, Makhan Lal Dutt and Shiv Kumar Khanna. By this lease, the building which was called Khanna Cinema House at 157, Upper Circular Road, Calcutta was demised to the lessees for a period of 30 years. The lessees agreed to pay under the indenture of l