.1. In this reference under Section 256(1) of the Income-tax Act, 1961 (for short “the Act”), the Tribunal has referred the following question for answer by this Court:

.“Whether, on the facts and in the circumstances of the case and in law, the Tribunal was justified that the assessee-trust was not liable to the charge of capital gains tax in view of the provisions of Section 53 of the IT Act, 1961?”

.2. Relevant asst. yr. is 1986-87, during which the assessee-trust sold residential property for Rs. 1,37,000. The cost of acquisition thereof was Rs. 80,000. The assessee claimed exemption of entire capital gains as per provisions of Section 53 of the Act. The AO, however, denied the exemption. According to him, exemption is available only to the assessee, whose status is ‘individual’ or ‘HUFs’ and not to ‘AOPs’. In appeal before the Dy. CIT(A), he confirmed the view taken by the AO. In further appeal before the Tribunal, the Tribunal has taken status of beneficiaries, who are having ‘individual’ status and the Tribunal was of the view that when ultimate income goes in the hands of ‘individual’ beneficiaries, they are entitled to benefit of Section 53 of the Act.

3. Heard le