COMMISSIONER OF INCOME TAX Vs. AVKASH NIDHI

JUDGEMENT

(1.) THE assessee, Avakash Nidhi, is a public charitable trust. The reference concerns the assessment year 1972 -73. During the said assessment year, the assessee disclosed the following donations, namely :

(2.) THE assessee claimed that the value of these donations aggregating to Rs. 2,45,746 is not liable to tax. The Income -tax Officer accepted the assessee's claim for the non -taxability of items Nos. (ii) and (iii) but so far as item No. (i) is concerned, he brought it to tax under section 12(2) of the Income -tax Act as it then stood. The assessee carried the matter in appeal. The Appellate Assistant Commissioner concurred with the view expressed by the Income -tax Officer and partly allowed the appeal in regard to the computation of capital gains tax. In further appeal, the Tribunal held that the view taken by the authorities below on the interpretation of section 12(2) of the Act as it then stood was not sustainable. The Revenue sought a reference under section 256(1) of the Act and, accordingly, the following question came to be referred for this court's decision :

(3.) SECTION 12(2), as it stood prior to its amendment by the Finance Act, 1972, read as under :