Ajit K. Sengupta, J.

1. IN this reference under Section 256(1) of the Income-tax Act, 1961, the following questions of law have been referred to this court for the assessment year 1979-80 :

"1. Whether, on the facts and in the circumstances of the case, the Tribunal was right in holding that the fixed deposits were not transferred to the shareholders and that the interest income of Rs. 31,105 (after deduction of expenses) on the said fixed deposits was assessable in the hands of the assessee ? Whether in the event of absence of transfer of the said fixed deposits, the Tribunal should have held that the interest income from the said fixed deposits could be assessed in the hands of the assessee only as trustee for the shareholders to whom the fixed deposits were handed over ?"

2. SHORTLY stated, the facts are that the assessee is a company which has been carrying on fishery business for a long time. For availing of the benefits of Section 54E of the Act, the assessee made fixed deposit of Rs. 4,20,000 on October 18, 1977, with the United Bank of India, Beliaghat Branch, Calcutta, for 61 months with effect from October 18, 1977, on interest of 10% per annum. The assessee follows