JUDGMENT
1. In proceedings under Section 256(1) of the Income-tax Act, 1961, the applicant called upon the Tribunal to state two questions of law for being considered by this court. One of the questions which the Tribunal was required to refer was whether the Income-tax Officer was justified in reopening the relevant assessment under Section 147(b) of the Act. The Tribunal felt that this question need not be referred.
2. The controversy with regard to the question sought to be referred to this court centres round the computation of capital gains with regard to jewellery. It appears that the assessee made an application to the Income-tax Officer that the jewellery was acquired during the period 1963 to 1975 and the capital assessed has to be computed as if the same came into existence on April 1, 1973, on the basis of the decision of the Supreme Court. It also appears that an audit report was received and thereafter the Income-tax Officer passed an order reopening the assessment under Section 147(b). The Tribunal has taken the view that the Income-tax Officer was in error in taking a notional value of the jewellery. According to it, the Income-tax Officer failed to take notice of the provisions of Sections 48 and 52(2) of the Act while computing capital gains in so far as jewellery was concerned.
3. Learned counsel for the parties have been heard at length. Incidentally, both the counsel rely upon the decision in the case of Indian and Eastern Newspaper Society v. CIT [1979] 119 ITR 996 (SC).
4. Having heard learned counsel for the parties, we are of the opinion that a question of law does arise for consideration by this court. We, accordingly, direct the Tribunal to draw a statement of the case and to refer the following question :
"Whether, on the facts and in the circumstances of the case, the Income-tax Officer was justifide in initiating proceedings under Section 147(b) of the Act in so far as computation of capital gains in relation to jewellery was concerned ? "
5. In the circumstances of the case, we direct the parties to bear their own costs.