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Section 104 of the Income-tax Act, 1961 - Additional income-tax on undistributed profits - For assessment year 1976-77, ITO levied additional income-tax under section 104 on ground that assessee did not distribute prescribed percentage of its distributable income as dividend within twelve months following expiry of previous year ending on 31-3-1976 - Whether, in view of fact that said default having taken place on 1-4-1977, law existing on that date would be applicable to assessee's case and tribunal was justified in upholding levy of additional tax on assessee - Held, yes Facts For the assessment year 1976-77, the ITO levied additional income-tax on the assessee under section 104 on the ground that the assessee had failed to distribute the prescribed percentage of its distributable income as dividend within the prescribed period. On appeal before the Tribunal, the assessee urged that the default had taken place on 1-4-1977, but as sub-section (4) of section 104 was amended with effect from 1-4-1978 excluding the assessee, engaged in manufacturing goods, from the operation of the provisions of section 104, the assessee was not liable to pay the said additional tax. The Tribunal, however, upheld the ITO's orders. On reference: Held The Tribunal had found that the default on the part of the assessee had taken place on 1-4-1977 as within 12 months following the expiry of the previous year, the dividend distributed by the assessee in respect of the previous year ending on 31-3-1976 was less than the prescribed percentage. In these circumstances, the law as in force on 1-4-1977 would be applicable to the assessee's case and under the provisions of section 104, as they existed on 1-4-1977, the assessee was liable for additional tax. Chaphekar and Samvatser for the Applicant. R.C. Mukati for the Respondent. ORDER Sohani, Avtg. CJ. - By this reference under section 256(1) of the Income-tax Act, 1961 ('the Act'), the Tribunal, Indore Bench, Indore, has referred the following question of law to this Court for its opinion: "Whether, on the facts and in the circumstances of the case, the Tribunal was right in holding that the law in force on 1-4-1977 was applicable to the…

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