Judgment

KHANNA, J. :- This appeal by special leave is directed against the judgment of Calcutta High Court whereby that court answered the following question referred to it under Section 66 (1) of the Indian Income Tax Act, 1922 in the negative and against the assessee appellant:

"Whether on the facts and in the circumstances of the case the sum of Rs. 32,986 had been validly excluded from the assessee s business income for the relevant assessment year?".

2. The matter relates to the assessment year 1960-61 for which the relevant previous year ended on March 31, 1960. The appellant assessee is a private limited company dealing in furniture. It also acts as an auctioneer. In respect of the sales effected by the appellant as auctioneer, it realised during the year in question, in addition to the commission, Rs. 32,986 as sales tax. This amount was credited separately in the books under the sales tax collection account. The total balance standing to the credit of this account since 1946 up to the end of the relevant previous year stood at Rs. 2,71,698. This sum was neither paid over to the exchequer nor was it refunded to the persons from whom it had been collected. In the earlier years