U.L. Bhat, C.J.

1. The following questions have been referred by the Appellate Tribunal at the instance of the Revenue under Section 256(1) of the Income-tax Act, 1961 (for short, "the Act of 1961") :

"(i) Whether, on the facts and in the circumstances of the case, the Tribunal was correct in law in holding that in respect of the properties settled on the assessee by his father, the correct status of the assessee was Hindu undivided family ?

(ii) Whether, on the facts and in the circumstances of the case and in view of the fact that the wife of the assessee was, in any case, the member of the Hindu undivided family, the Tribunal was correct in excluding the income from capital gains from the assessment of the assessee?"

The respondent herein, the assessee, in the returns submitted during the period 1957-58 to 1971-72 declared his status to be individual. He did not file returns for the period 1972-73 to 1974-75. When notices were sent to him under Section 139(2) and Section 148 of the Act of 1961, he submitted returns as an individual but specifically pleaded that his status is a Hindu undivided family and not an individual. The Assessing Officer overruled this contention and a