Judgment - Chagla, C.J.

1. A rather important question arises on this reference as regards the power of the Commissioner to revise the orders of an Income-tax Officer under Section 33B.

2. The assessee is a Hindu undivided family, the karta of which is one Tejaji Farasram Khara-wala. This Hindu undivided family was the sole selling agent of dyes and chemicals manufactured by Ciba (India) Ltd. and Imperial Chemical Industries (India), Ltd. On 24-10-1947, this family agreed to transfer this business to a private limited company by the name of Tcjaji Farasram Khara-wala, Ltd., and the share-holders of this company were the members of the joint family. Under the agreement of sale the goodwill of the business was fixed at Rs. 50,000. The familys income for Samvat Year 2003 was computed at Rs. 3,51,506. This amount included a sum of Rs. 25,000 which was included as representing the goodwill of the business which had been transferred to the private limited company. As the goodwill was transferred for Rs. 50,000, the Income-tax Officer computed the balance of Rs. 25,000 as capital gain under Section 12-B, Income-tax Act.

The Hindu undivided family appealed to the Appellate Assistant commissio

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