Law: Income Tax Act, 1961

Section: 3

Income-tax--Previous year---Income from race winning---Previous year is financial year---Indian Income Tax Act, 1961 S.3. The assessee was an individual. He won a jackpot of Rs.86,014 on November 7, 1971. The assessee's year of account in respect of business carried on by him was the Diwali year, which ended on December 5, 1972. The original assessment for the assessment year 1973-74 was completed on November 7, 1977, determining his total income at Rs.30,510. The assessment was later reopened for bringing to tax the above jackpot winning under the provisions of section 147 of the Income Tax Act, 1961. The assessee contended before the Income-tax Officer that in respect of the above jackpot winning the previous year should be taken as the financial year, since no separate accounts were maintained for that source of income and the said sum was not assessable for the assessment year 1973-74. The Income-tax Officer did not accept the assessee's contention, but on appeal the Commissioner (Appeals) accepted the assessee's claim. The Tribunal upheld the order of the Commissioner of Income-tax (Apeals). On a reference: Held, that the relevant previous year for the race winning would be the financial year and the relevant assessment year would be 1972-73 and not 1973-74 as contended by the Department. CIT v. Rashmi Kamdar (1996) 217 ITR 559 (Mad.) fol. THIS JUDGMENT DELIVERED BY: N. V. BALASUBRAMANIAN, J.---In pursuance of the direction of this Court in T.C.P. No.195 of 1981, dated November 2, 1991, the Appellate Tribunal has referred the following question of law for .our consideration under section 256(2) of the Income Tax Act, 1961. "Whether, on the facts and in the circumstances of the case, the Appellate Tribunal was justified in holding that the relevant previous year for the race winning would be the financial year and the relevant assessment year would be 1972-73 and not 1973-74 as contended by the Department"? The assessee is an individual. He won a jackpot of Rs.86,014 on November 7, 1971. The assessee's year of account in respect of business carried on by him was the Diwali year, which ended on December 5, 1972. The original assessment for the assessment…

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