SABYASACHI MUKHARJI, J.

( 1 ) IN this reference under Section 256 (1) of the I. T. Act, 1961, the following question has been referred to this court :"whether, on the facts and in the circumstances of the case, the Tribunal was right in holding that amount of Rs. 1,00,000 could be subjected to tax as capital gains under the provisions of Income-tax Act, 1961?"

( 2 ) THE assessee was one Shri Laxmandas Agarwalla and was dead and the assessment was made upon the legal heirs, Smt. Brijmoni Devi and others. This reference relates to the assessment year 1965-66 for which the previous year ended on the Dewali 2021. The assessee stated before the ITO that the property at No 7, Jatindra Mohan Avenue, Calcutta, has been sold for Rs. 3 lakhs to Prayag Devi Trust, a trust created by Shri Laxmandas Agarwalla in which he and his wife, Smt. Brijmoni Devi, were trustees. The building was a five-storeyed brick-built building constructed on 10 cottahs-7 sq. ft. of land. The property was mortgaged to M/s. Allahabad Bank Ltd. to cover up the security for overdraft arrangement along with the other shares, etc. On the 30th June, 1960, the building was released by payment of Rs. 3 lakhs to the bank. Ac

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