Y. R. Meena, Bijitendra Mohan Mitra

( 1 ) THIS application under Section 256 (2) of the Income-tax Act, 1961, has been taken out on the ground whether the amount of Rs. 2,48,348 is a capital receipt or a revenue receipt.

( 2 ) IN the decision, based on the appreciation of the evidence and whether it should be taxed or not, the Tribunal has followed the decision of the apex court in Miss Dhun Dadabhoy Kapadia v. CIT, [19671 63 ITR 651 and the decision of this court in CIT v. Oberoi Building and Investment P. Ltd. , [1993] 203 ITR 403,

( 3 ) WE issued rule and heard learned counsel on rule.

( 4 ) THE assessee is an investment company. It was holding 33,000 equity shares of Indian Rayon and Industries Ltd. The said company issued 13. 5 per cent. secured fully convertible debentures on rights basis to its existing shareholders in the ratio of one debenture for one equity share held. The assessee subscribed to 6,000 debentures and transferred the right to subscribe to 27,000 debentures, for which it received Rs. 2,48,348.

( 5 ) BEFORE the Assessing Officer, the assessee has claimed that the right to subscribe to the debentures was a capital asset and that as there was no cost of acqu

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