LAWS(KER)-1971-4-3

DURAIRAJ REDDIAR Vs. CIT KERALA

Decided On April 06, 1971
DURAIRAJ REDDIAR Appellant
V/S
CIT, KERALA Respondents

JUDGEMENT

(1.) THIS is a reference by the Income-tax Appellate tribunal, Cochin Bench under S. 256 (2) of the Income-tax Act, 1961 as directed by this Court at the instance of the assessee. The questions referred are,

(2.) THE assessee had collected some amounts from purchasers, which he had credited in a separate account styled "mahima account". THE gross collections less disbursements during the accounting year under this head amounted to Rs. 4,497. 60. He transferred this amount to another head called "god's Account". THE assessee claimed that this amount was not includable in his total income as it was set apart for charitable purposes. THE claim was rejected on the ground that the said amount had not been applied for charitable purposes.

(3.) COUNSEL for the assessee did not rightly press the second question in the reference. The Appellate Tribunal found that what was being credited in Mahima Account and subsequently transferred to God's Account were actually collections towards incidental expenses in his trade, and that there was no legal obligation to spend any part thereof for charitable purposes. The second question in the reference is, therefore, answered in the affirmative and against the assesse.