Judgment

K. RAMASWAMY

( 1 ) BY proceeding dated 21/01/1959 the respondent was assessed to income-tax for the assessment year 1957-58 ending with financial year 31/03/1957. On transfer on point of jurisdiction, the Income-tax Officer, Special IV Circle, Cuttack had drawn his proceeding on 2/07/1965 to reopen the assessment under Sections 147 (a) and 148 of the Incometax Act, 1961 (for short the Act) and obtained the approval of the Commissioners of Income-tax, Cuttack, Bihar and Calcutta thus:.

"the assessee sold his mining business during the relevant accounting year to a Company named Messrs. B. Patnaik Mines (P.) Ltd. and earned a profit of Rs. 15 lakhs which was assessable as capital gains but was not shown by the assessee in his return. The transfer of the business was stated by the assessee to have been made on 31-3-1956 and as such the amount of capital gains was not liable to taxation, it was claimed by the assessee since capital gains was not subjected to taxation in the assessment year 1956-57. But from information now available it appears that the transfer of the business took place on 3-11-1956 and thus the assessee was liable to be taxed on the capital gains earned in the