JAGANMOHAN REDDY, J.

( 1 ) THE income tax appellate Tribunal, Hyderabad , has stated a case as directed by this court under section 66 (2) of the Indian Income Tax Act, 1922, in I. T. C. M. P. No. 5478 of 1961, on the following questions, namely : (1) Whether the transaction dated 19-9-1956 amounts to a sale within the purview of the second proviso to section 10 (2) (vii) of the Indian Income tax Act ? Alternatively: Whether the consideration for the sale is not the market value of the shares as on the date of the transaction, namely Rs. 95. 00 per share, but the face value of the shares.

( 2 ) THE assessment with respect to which the reference has been made is for the year 1956-57 relating to the accounting period of 1955-56. The facts as set out by the Tribunal in the statement of the case is that the assessee is a private limited company, a cinema house from which it was deriving income by exhibiting films. In a meeting of the Board of Directors held on 9-9-1955, it was resolved that the Managing Director, the Raja of Bobbili, may be authorized to negotiate with the Zamindar and the Zamindarini of negotiate with the Zamindar and the Zamindarini of Chikkavaram and or their nomine

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