JUDGMENT :

(K.R. Shriram, J.)

1. Petitioner, a bank in the private sector filed its return of income for Assessment Year 1997-98 on 1st December 1997. In the computation, petitioner returned income of Rs.12,73,80,111/- being interest accrued as due on Government securities and debentures held by petitioner as on 31st March 1997.

2. By an order dated 28th March 2000 2nd Respondent (ACIT) completed the Assessment for Assessment Year 1997-98. In the Assessment Order among other adjustments, the 2nd Respondent held that a sum of Rs.25,17,19,849/- being interest on Government securities held by petitioner had accrued to petitioner as on 31st March 1997 and as such was liable to tax under Section 5 of the Act. The 2nd Respondent further held that a sum of Rs.12,73,80,111/- being interest received by petitioner in the Financial Year 1996-97 (Assessment Year 1997-98) and offered as income was in fact income of the preceding year, i.e., Assessment Year 1996-97 and was wrongly offered to tax in Assessment Year 1997-98. Accordingly 2nd Respondent brought to tax in Assessment Year 1997-98 a sum of Rs.12,43,39,738/- (incorrectly mentioned as Rs.12,46,39,738/-) being the difference between Rs.25,