Alfred Henry Lionel Leach, C.J.
1. The assessee is a Nattukottai Chettiar who was carrying on a money-lending business at Kajang in the Federated Malay States. In the year of account he instructed the Indiano Overseas Bank, Limited, at Kualalampur, to remit to its Karaikudi branch a sum of Rs. 8,000 which the bank at Karaikudi was to hold as a fixed deposit of the assessee, repayable at the end of twelve months. The money which the assessee paid into the bank at Kualalampur when he gave those instructions represented profits which the assessee had made at Kajang. This is not disputed. When the deposit matured the amount was paid to the assessee at Karaikudi. In these circumstances the Income-tax Officer held that the remittance from Kualalampuir represented a remittance of profits made by, the assessee at Kajang and included this amount in the assessment.
2. There was an appeal to the Assistant Appellate Commissioner who took a different view of the transaction. The Appellate Assistant Commissioner considered that the money on deposit with the Karaikudi branch of the Bank merely represented an asset of a person resident abroad and therefore should not have been included in the assessment. This opinion was accepted by the Income-tax Appellate Tribunal whereupon the Commissioner of Income-tax applied for a reference under Section 66(1) of the Indian Income-tax Act. Consequently the Tribunal has referred this question:
Whether in the circumstances of the case this sum of Rs. 8,000 could be treated as profits of the respondent's business outside British India brought into or received by him in British India in the year of account.
We have no hesitation in holding that the correct view was that taken by the Income-tax Officer. The assessee provided the money which the Bank remitted from Kualalampur to Karaikudi and that money constituted profits made by him in his money-lending business at Kajang. When the money arrived in Karaikudi it was held by the bank as a fixed deposit in accordance with the assessee's instructibriss and thus constituted an asset of his which had been acquired out of profits made abroad. There can be no difference between the present Case and a case where' a Nattukottai Chettiar doing business abroad instructs his bank there to buy for him Indian securities out of the profits made by him in such business. Those securities when bought in India would represent profits brought into this country. In the same way, the deposit receipt which the respondent got from the Karaikudi branch of the Bank represented an investment in British India of Rs. 8,000 of his profits, made abroad. Admittedly he realised the investment in the next year.
3. We answer the reference by saying that the Rs., 8,000 must be treated as profits of the respondent's business outside British India brought into British India by him in the year of account. The Commissioner is entitled to his costs, Rs. 250.