Judgment

RANGANATHAN, J.

( 1 ) THESE appeals raise a question of some complexity on the interpretation of the provisions of the Income Tax Act,1961 (the 1961 Act), in regard to which there is a difference of opinionamong various High courts. In the judgment under appeal, reported ascit v. Garden Silk Wvg. Factory, the Gujarat High court has answeredthe question raised in favour of the revenue and against the assessees. Hence these appeals by the assessee, M/s Garden Silk Weaving Factory, Surat.

( 2 ) THE two appeals relate to the assessment years 1967-68 and 1968-69 for which the relevant previous years were the Saka years 2022 and2023 respectively. The question arises in similar circumstances for boththe years. We shall set out the facts relevant for the assessment year1968-69 as the appeals and reference in respect of that year were disposed of earlier than those pertaining to the assessment year 1967-68.

( 3 ) THE assessee, M/s Garden Silk Weaving Factory, is a registeredfirm. For the assessment year in question, it returned a total income ofrs 3,94,483 and a provisional assessment, under S. 141 of the Act,was made accepting the income returned. Subsequently, the Income Taxofficer