COMMISSIONER OF INCOME TAX Vs. ABDUL AZIZ

JUDGEMENT

(1.) This appeal by special leave is directed against the order of the High Court Division in application No. 1 of 1981 under section 66(1) of the Income Tax Act.

(2.) The respondent is an Income Tax Assessee and filed return of his income for the assessment year 1971-72 showing his total income at Tk. 15,045/- and claimed exemption of Tk. 881/00 being dividend income from a company and enjoying benefits of tax under section 15BB of the Income Tax Act. The respondent also claimed exemption from tax on account of investment of Tk. 2,200/- in Bonus share under section 15C of the Income Tax Act. The Income Tax Officer while assessing the Income of the respondent under section 23(3) of the Act disallowed the claims of the respondent and assessed his total income at Tk. 25,883/00 by his assessment order dated 12.3.1974. On appeal by the assessee the Assistant Commissioner allowed the appeal in part but rejected the prayer for rebate on account of investment in bonus share of Tk. 2,200/-. This order was challenged before the Income Tax Appellate Tribunal. The Tribunal took the view that the assessee acquired 220 bonus share of the face value of Tk. 2,200/-by indirect investment and therefore shall be entitled to get investment allowance under section 15C of the Income Tax Act. Revenue filed an application under section 66 of the Income Tax Act which was marked as Application No. 1 of 1981 raising the following question of law:

(3.) A Division Bench of the High Court Division decided the question by answering the same in affirmative against the department. Leave was granted on the following terms: