COMMISSIONER OF INCOME TAX Vs. JOHNSON C F

JUDGEMENT

(1.) WITH regard to the assessment year 1989-90, in regard to the allegation that the assessee received and one Shri Sundaresa Pai paid an amount of Rs. 10 lakhs in addition to Rs. 2 lakhs as security deposit, the Income-tax Officer acted on the basis of the sworn affidavit of Shri Sundaresa Pai with regard to the payment made by him and acceptance thereof by the assessee in question in the matter of a lease dated February 10, 1989, of the premises covered thereby. It is a lease for a period of 20 years. WITH regard to the amount in question, as stated, the material was the sworn testimony in the nature of affidavit of the person who paid. The decision was affirmed by the first appellate authority observing that Rs. 2 lakhs being the amount of deposit, refundable as security deposit could not be understood as the capital gains.

(2.) THE Tribunal firstly observed that the transaction could not be understood as a transfer in law. THE Tribunal further observed that the affidavit of Shri Sundaresa Pai could not be legally acted upon because he was not put to cross-examination by the assessee. THE evidence of affidavit becomes acceptable unless a right of cross-examination is demanded in regard thereto.