LAWS(KER)-1994-7-14

COMMISSIONER OF INCOME TAX Vs. PRAKASHAN V

Decided On July 14, 1994
COMMISSIONER OF INCOME-TAX Appellant
V/S
V. PRAKASHAN Respondents

JUDGEMENT

(1.) THIS is a reference application under Section 256(2) of the Income-tax Act, 1961, at the instance of the Revenue. The relevant assessment year is 1983-84. The assessee, at the material time, derived income from plying buses in the name of Prakash Bus Service. During the previous year relevant to the assessment year in question, the assessee sold his bus for a consideration of Rs. 1,10,000. The bus had been purchased by the assessee on July 10, 1979, for Rs. 40,000. The assessee contended before the Income-tax Officer that the sale value of the bus alone was only Rs. 40,000 and the balance of Rs. 70,000 was the amount paid by the purchaser for obtaining the permit to ply on the route in question, i.e., the route value. THIS contention has been upheld by the Tribunal. The Revenue's application for making a reference under Section 256(1) has been rejected by the Tribunal. Hence, this petition is before us under Section 256(2) of the Income-tax Act for a direction that the Tribunal be asked to raise the following question and refer it to us :

(2.) THE Tribunal has referred to the agreement between the assessee and the purchaser, the relevant portion of which is set out in the assessment order of the Income-tax Officer. THE agreement recites as follows :