JUDGMENT - Chagla, C.J.

1. A very short question arises on this reference as to the proper interpretation of the third proviso to Section 12B(1) of the Indian Income-tax Act. The assessment years are 1947-48 and 1948-49 and the assessee is the administrator of the estate of one Henry Gannon. Henry Gannon died on the 13th May, 1945, having left a will dated 18th November, 1942 and probate was issued of this will to the National Bank of India in England as the executors. The National Bank gave a power-of-attorney to the assessee and the assessee applied to the Court under Section 241 of the Indian Succession Act and obtained Letters of Administration with the will annexed. In the course of the administration of the estate the assessee sold shares and securities belonging to the deceased and it was found that for the assessment year 1947-48 there was a profit of Rs. 20,13,738 and for the assessment year 1948-49 the profit was Rs. 1,51,963. the Department contended that these sums represented the capital gains and they were liable to tax. The assessees contention was that he was not liable to pay tax on these capital gains because his case fell within the ambit of the third proviso to S

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