R. GURURAJAN, J. ( 1 ) APPELLANT is before us raising the following questions of law: whether the assessing officer is empowered to decide as to whether a receipt is on revenue or capital account while making an adjustment under clause (iii) of the first proviso to Sec. 143 (1) (a) ? 2. Whether the appellant's claim that the gain in exchange on export realisations constituted a capital receipt and as such not liable to income-tax having been fully supported by a direct ruling of the Calcutta High court reported in 137 ITR 827 : (1982 Tax lr 1542) could still be said to be unsustainable to justify the respondent's action in treating it as a prima facie adjustment. 3. Whether judgments of the Supreme court relied upon by the respondent for justifying the action having been considered by the Calcutta High Court in the judgment referred above was not sufficient to render the issue a debatable one and as such take it outside the scope of prima facie adjustment within the meaning of Sec. 143 (1) (a) of the Act? ( 2 ) THE facts in brief are as under : During the previous year ended on 31-3-1991, appellant had realised a gain in the foreign exchange owing to exchange rate fluctuation in a sum of Rs. 17,60,522/ -. According to the appellant the said gain constituted a capital receipt and the same is not liable to income-tax for the reason that the appellant being a manufacturer of fuel injunction equipment, spark plugs etc. and exporter of the same realised the sale proceeds in foreign exchange and the appellant was not a dealer in foreign exchange. The appellant is supported by a judgment of the Calcutta High Court Indian leaf Tobacco Development Co. v. C.. T. 1982 (137) ITR 827 : (1982 Tax LR 1542) and it claimed exemption in respect of the aforesaid sum. A letter as sent in this regard on 23-12-1991. The assessing officer disallowed the said claim after passing an intimation under Section 143 (1) (a) of the Act. The said adjustment was made as a prima facie adjustment allegedly permissible under Sec. 143 (1) (a) of the Act. The respondent authority did not accept the said adjustment as prima facie an adverse order was passed against which an appeal was filed unsuccessfully. Thereafter second appeal was filed before the tribunal. The said adjustment was made as a prima facie adjustment allegedly permissible under Sec. 143 (1) (a) of the Act. The respondent authority did not accept the said adjustment as prima facie an adverse order was passed against which an appeal was filed unsuccessfully. Thereafter second appeal was filed before the tribunal. Tribunal has also chosen to reject the appeal filed by the assessee. Assessee is therefore before us raising the above referred questions of law for our consideration. ( 3 ) LEARNED counsel for the appellant would say that a judgment of the Calcutta High Court supports the case of the assessee and the assessee in terms of the letter dated 23-12-1991 has stated that the gain in exchange on export realization does not represent any trading receipt arising out of such business activity as the assessee is not a dealer in foreign exchange. The said gain represents the excess realization on export sales consequent to a more favourable rate of exchange prevailing on the date of realization of invoice as compared to the date on which the shipment was effected. Such excess realization due to fluctuations in the rates of exchange cannot be regarded as trading receipt. Reliance was placed on the judgment of the Calcutta High court. They are justified in claiming a prima facie adjustment in the case on hand. He finds fault with the order of the assessing officer. He makes same grievance with regard to the orders passed by the Commissioner and the tribunal. He further elaborates by contending that even assuming that prima facie error has been committed, even then, no case as such is made out by the authorities for the purpose of imposing tax under Sec. 143 (1) (a) of the Act. He relies on several judgments. Per contra, learned counsel for the revenue supports the impugned order. According to him two judgments of this Court would support the case of the revenue. ( 4 ) AFTER hearing, we have carefully perused the material on record. ( 5 ) SEC. He relies on several judgments. Per contra, learned counsel for the revenue supports the impugned order. According to him two judgments of this Court would support the case of the revenue. ( 4 ) AFTER hearing, we have carefully perused the material on record. ( 5 ) SEC. 143 (1) (a) would read as under : "where a return has been made under Sec. 129, or in response to a notice under sub-section (1) of Sec. 142,- (i) if any tax or interest is found due on the basis of such return, after adjustment of any tax deducted at source, any advance tax paid and any amount paid otherwise by way of tax or interest, then, without prejudice to the provisions of sub-section (2), an intimation shall be sent to the assessee specifying the sum so payable, and such intimation shall be deemed to be a notice of demand issued under Sec. 156 and all the provisions of this act shall apply accordingly; and (ii) if any refund is due on the basis of such return it shall be granted to the assessee; provided that in computing the tax or interest payable by or refundable to. the asses- see, the following adjustments shall be made in the income or loss declared in the return namely, (i) any arithmetical errors in the return, accounts or documents accompanying it shall be rectified; (ii) any loss carried forward, deduction, allowance or relief, which, on the basis of the information available in such return, accounts or documents, in prima facie admissible but which is not claimed in the return shall be allowed; (iii) any loss carried forward, deduction, allowance of relief claimed in the return, which, on the basis of the information available in such return, accounts or documents. is prima facie inadmissible, shall be disallowed: provided further that an intimation shall be sent to the assessee whether or not any adjustment has been made under the first proviso and notwithstanding that no tax or interest is due from him : ( 6 ) SEC. 143 (1) (a) would provide for an additional income-tax in the event of total income exceeding the declared income, in the light of the addition being made in terms of sec. 143 (1) (a) of the Act in the case on hand. The assessing authority has chosen to issue an intimation under Sec. 143 (1) (a) of the Act. 143 (1) (a) would provide for an additional income-tax in the event of total income exceeding the declared income, in the light of the addition being made in terms of sec. 143 (1) (a) of the Act in the case on hand. The assessing authority has chosen to issue an intimation under Sec. 143 (1) (a) of the Act. An adverse order was also passed. Thereafter an appeal was filed. The appellate authority noticed material facts and thereafter held that in the light of the judgment of the Supreme court, in 63 ITR 328 : ( AIR 1967 SC 417 ). the appellant cannot takes shelter behind the decision of the Calcutta High Court which is not the jurisdictional High Court and which had come to a different conclusion in view of the peculiar questions referred to it. The tribunal has also taken the same stand. ( 7 ) IN the light of the arguments, we have carefully perused the material on record. Prima facie adjustment has been considered by Courts of Law. In fact a Division Bench of this Court in ITRC 660/98 DD 22-6-2005 has chosen to consider prima facie adjustment. This Court has ruled that prima facie case is not to be understood as proof of obligation by way of evidence etc. Prima facie consideration has to be prima facie or to use the dictionary meaning 'at the first sight' or 'the first impression'. It may be that impression may be varied/modified or ever destroyed at the stage of final hearing. The final hearing approach has not been the approach at the first impression namely, prima facie impression in terms of Sec. 143 of the Act. In the light of the law declared by this Court in terms of the apex Court judgment. ( 8 ) LET us see as to whether 'prima facie adjustment' in the light of the Calcutta High court judgment would stand the test of law. Calcutta High Court has considered the profit due to fluctuation in exchange rate. Calcutta high Court has come to a conclusion that where a surplus arises due to a fluctuation in the exchange rate, the true test to find out if such surplus is to find out if it arose out of many trading activity. Calcutta High Court has considered the profit due to fluctuation in exchange rate. Calcutta high Court has come to a conclusion that where a surplus arises due to a fluctuation in the exchange rate, the true test to find out if such surplus is to find out if it arose out of many trading activity. It must be a result of a trading activity of the assessee or it must arise or result from the trading activity of the assessee. Merely because the holder of a currency gets something more than what it would have got otherwise would not transform the accretion into a trading profit unless the holding or the dealing in foreign exchange of the particular currency was the trading activity of the concerned. Calcutta High Court has noticed two judgments of this Court (1963) 49 ITR 471 (Mys) and (1963) 47 ITR 529 (Mys ). ( 9 ) IN 49 ITR 471 a Division Bench of this court has come to a definite conclusion that the appreciation in Indian rupee of the dollar holdings was a 'receipt arising from business; within the meaning of Sec. 4 (3) (vii) of the income-tax Act and is not exempt from income-tax. ( 10 ) SIMILARLY in the case of 47 ITR 529 a bench of this Court took a view in favour of the assessee. The matter was taken to the Supreme court, the Supreme Court in 63 ITR 328 : ( AIR 1967 SC 417 ) has ruled that if by virtue of exchange operations profits are made during the course of business and in connection with business transactions. the excess receipts on account of conversion of one currency into another would be revenue receipts. But if the profit by exchange operations comes in, not by way of business of the assessee, the profit would be capital. ( 11 ) IN the light of these two judgments it is clear to us that in so far as the receipt in the case on hand is concerned, it is nothing but a revenue receipt. Calcutta High Court has chosen to take a different view in terms of the judgment as referred to by the assessee. Therefore in our view the assessing authority is justified in rejecting the prima facie adjustment in the light of two judgments of the jurisdictional high Court in the case on hand. Calcutta High Court has chosen to take a different view in terms of the judgment as referred to by the assessee. Therefore in our view the assessing authority is justified in rejecting the prima facie adjustment in the light of two judgments of the jurisdictional high Court in the case on hand. The same has been noticed by the Commissioner and the tribunal as mentioned earlier in terms of the law governing prima facie adjustment. The case of the assessee cannot be accepted in the light of two clear pronouncements of this Court available on record on the date when the letter was sent to the authorities. The authorities are therefore justified in our view in accepting the case of the revenue. We are not impressed that a prima facie case has been made out in the light of the Calcutta High court judgment. We reject this submission. If any such argument is accepted it would result in unworkable situation. Authorities have accepted the prima facie adjustment theory based on the judgment of jurisdictional High court if available. At this stage, it may be relevant to mention here that in case of the very assessee this Court has not accepted the case of this very assessee in the light of two judgments even after noticing the Calcutta High court judgment. Therefore we have no hesitation in holding against the assessee in terms of the orders of all the authorities. ( 12 ) LEARNED counsel for the assessee would however say that when the notice was issued, an order was available to them in their favour at the hands of the Commissioner. It may be true, but even then, in the light of two binding high Court judgments any consideration of the assessee's case in a matter like this would result in diluting the order of a jurisdictional high Court. We are not prepared to do so. ( 13 ) LEARNED counsel would further argue that if the tax is levied, even then, penalty in the guise of additional tax is unsustainable in the absence of availability of loss carried forward or deduction etc. in terms of Sec. 143 (1) (a) of the Act. He would also read to us Sec. 29 and other provisions of Income- tax Act to say that unless an addition is made in terms of the argument, penalty is unsustainable in law. in terms of Sec. 143 (1) (a) of the Act. He would also read to us Sec. 29 and other provisions of Income- tax Act to say that unless an addition is made in terms of the argument, penalty is unsustainable in law. At this stage, we should say that levy of additional income-tax is not penalty. In fact when this provision was challenged before the Supreme Court in (2001) 251 ITR 200 : ( AIR 2001 SC 1531 ) (Asst. CIT v. J. K. Synthetics), this section was upheld by the Supreme Court. ( 14 ) IN so far as non-leviability of additional income-tax is concerned, though this argument is attractive, the same cannot be accepted in the absence of any foundation as such laid by the appellant. Nowhere in the proceedings before the authorities this point has been urged or canvassed on behalf of the assessee. None of the authorities have given any finding with regard to this contention which is raised before us for the first time. Even the questions of law framed by the assessee would not provide for any consideration in the way in which the learned counsel wants us to consider for the purpose of deletion of additional income-tax levied under Sec. 143 of the Act. In these circumstances, we are not inclined to consider this aspect of the matter in the given circumstances and in the absence of any foundation being available to the assessee. ( 15 ) LASTLY, learned counsel for the assessee relies on a departmental instruction No. 1814 dated 4-4-1989 to say that the said instruction would support the case of the assessee. He would say that in terms of the circular the assessing authority ought to have held in his favour. We have carefully perused the said circular. In the said circular, nowhere it is stated with regard to the availability of the judgment of the jurisdictional High Court. In the absence of any such mention in the circular with regard to the judgment of the jurisdictional high Court, we are not prepared to blindly accept the instruction for the purpose of consideration of the case of the assessee. ( 16 ) IN the result, we deem it proper to reject this appeal by answering the questions of law in the favour of the revenue. Appeal dismissed.