( 1 ) THE question referred for out opinion under s. 256 (1) of the I. T. Act is :"whether, on the facts and in the circumstances of the case, the Tribunal was justified in holding that the transactions in question, which resulted in payment of price differences, a did not constitute a speculation business within the meaning of section 43 (5) read with Explanation 2 to section 28 of the Income-tax Act, 1961 ?"

( 2 ) WE may briefly state the facts leading to this reference : The assessee is a firm carrying on business in manufacture and sale of rice bran oil and deoiled bran by a process known as "solvent extraction" process. Its accounting year is the financial year. We are concerned her with three assessment years, viz. , 1966-67, 1967-68 and 1971-72. The assessee has been entering into contracts with reputed concerns like Tata Oil Co. Ltd. , Hindustan Lever Ltd. , Godrej Soaps Ltd. , etc. , for ready delivery of rice bran oil manufactured by it over last several years, and it has been fulfilling most of the contracts entered into. However, during the accounting years relating to the aforesaid three assessment years, it could not deliver oil in pursuance of some of