Commissioner of Income Tax vs Smt. Rama Rani Ghai

In this reference pertaining to the assessment year 1976-77, the following two questions of law have been referred u/s 256(1) of the income tax Act, 1961 (''Act'') by the income tax Appellate Tribunal (''Tribunal'') for our opinion :

Whether, on the facts and in the circumstances of the case, the Tribunal was correct in law in upholding the order of the Commissioner of income tax (Appeals) [''CIT(A)''] holding that the prize money from winning of lottery is taxable on accrual basis and not on receipt basis?

Whether, on the facts and in the circumstances of the case, the Tribunal was correct in law in upholding that the amount of Rs. 1,80,000 received from the Director of Bihar State Lotteries was not assessable in the assessment year 1976-77 in spite of the fact that the prize money was received by the assessee by cheque on 2-5-1975 ?

Learned counsel for the assessee has pointed out that the CIT(A) in his order dated 19-1-1980 had directed the Inspecting Assistant Commissioner to include the amount of Rs. 2,07,270 in the income for the assessment year 1975-76 after giving an adequate opportunity to the assessee to represent her case. The order passed by the CIT(A) was upheld by the Tribunal and that is how the reference was made to us.

Learned counsel for the assessee has informed us that pursuant to the order passed by the CIT(A) , which was upheld by the Tribunal, the Assessing Officer reopened the assessment for the assessment year 1975-76 and passed an order on 16-5-1985 including the amount in that assessment year. This order passed by the Assessing Officer had since been accepted by the assessee and, therefore, nothing further survives in the matter. In view of the above facts which have been brought to our notice by learned counsel for the assessee, we return the reference unanswered.