CHAKRAVARTTI, J.

1. THE question involved in this reference is almost a conundrum. It arises out of the following facts : THE assessee M/s Chainrup Sampatram is a registered firm constituted of two partners, Sumermull and Budhmull, who are brothers and hold equal shares. THE firm is resident and ordinarily resident but the partners are non-residents, being residents of Bikaner. I should rather say that they were non- residents in the year of account which was 1998 R. N., because to say at the present time that a person residing at Bikaner is non- resident will be inappropriate. THE firm had its place of business at 9, Armenian Street, Calcutta, and carried on business as bullion dealers, dealing mainly in silver. THE method of accounting followed by the firm is the mercantile method. For the accounting year 1998 R.N., the firm returned an income of Rs. 1,16,297 for income-tax purposes, of which Rs. 73,652 was shown as income from business. THE same income was returned for excess profits tax purposes. THE ITO, however, added a sum of Rs. 2,20,887 as the excess arising from the valuation of a part of the firm's stock-in-trade in silver which, though belonging to the firm, had