C. K. BANEEJI, J.

( 1 ) THIS reference under Section 66 (1) of the Indian I. T. Act, 1922 (hereinafter referred to as "the Act") is at the instance of the assessee, Katihar Jute Mills (P.) Ltd. , Howrah. The relevant assessment year is 1955-56 for which the relevant accounting year is the calandar year 1954. The facts found by and/or admitted before the Tribunal areas follows : the assessee is a limited company owning a jute mill. The original assessment under Section 23 (3) of the Act was made on the 27th January, 1960. In the said assessment a sum of Rs. 5,22,450 was brought to tax representing the price of loom hours.

( 2 ) THE assessee preferred an appeal before the AAC with regard to two points, namely, (1) treatment of the loss in speculative transactions, and (2) certain disallowances out of expenses. The AAC disposed of the appeal in the following terms :" Before the Income-tax Officer the contract papers were not produced. These are now produced. I have examined the account books also. I find that these are genuine business transactions and losses. However, since the Income-tax Officer has not examined the vouchers and the contract papers, I set aside the assessment with

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