COMMISSIONER OF INCOME TAX Vs. LALIT BHASIN

JUDGEMENT

(1.) THE Commissioner of Income Tax is aggrieved from the order dated 3rd August, 2001 passed by the Income Tax Appellate Tribunal wherein it was held that the provisions of Section 69B of the Income Tax Act (hereinafter referred to as the Act) were not applicable to the case of the assessed in relation to payment of Rs.50,000/ - to the Calcutta Stock Exchange through the broker Ajit Kumar Dey of Calcutta. Consequently, the appeal preferred by the Department was dismissed by the Tribunal.

(2.) THE necessary facts are that the assessed has filed his return of Income Tax on 31.10.91 declaring the net income of Rs.4,06,810/ - for the assessment year 1991 -92. The matter was taken up for scrutiny and notice was issued under section 143(2) which was served upon the assessed, whose representative appeared. During the course of assessment proceedings, it came to the notice of the Assessing Officer that a ticket for Rs.50,000/ - of Calcutta Stock Exchange from Shri Ajit Kumar Dey was purchased allegedly by the assessed, while according to the value of the ticket might have been above Rs.10 lacs. The assessed was called upon to explain this entry. Finally, the Assessing Officer took the value of the ticket at Rs.11,50,000/ - and gave the benefit of Rs.50,000/ - paid by the assessed, added the balance income of Rs.11 lacs as un -explained investment expenditure and made addition thereto to the income of the assessed. Further the Penalty proceedings under section 27(1)(c) of the Act were also initiated against the assessed. Upon appeal by the assessed, the Commissioner of Income Tax, deleted the addition of Rs.11 lacs as well as granted the following relief to the assessed : -

(3.) ON the other hand, learned counsel appearing for respondent contends that the payment was made by a bank draft, the receipt of which is admitted by Ajit Kumar Dey and as the balance consideration was not paid, the petitioner had not purchased the ticket as yet as such the entire order of the Assessing Officer is based upon conjunctures and surmises.