NATIONAL TEXTILES Vs. COMMISSIONER OF INCOME TAX

JUDGEMENT

(1.) AT the instance of the assessee, out of many questions proposed, only the following questions have been referred under S. 256(1) of the IT Act.

(2.) ALL the above questions are on the justifiability of imposition of penalty on the assessee under s. 271(1)(c) of the IT Act, 1961, and they being interrelated can be dealt with jointly for giving a common answer.

(3.) IN his assessment case for the year 1974 75, the assessee had in his revised return showed an income of Rs. 95,641. The ITO however made additions to the income on two counts : (a) Rs. 80,000 in respect of unexplained cash credit in the name of one M/s Merchant Brothers. (b) Rs. 90,000 in respect of certain squared up accounts (the actual amount of squared up account was Rs. 1,40,000 and the ITO accepted the assessee's explanation regarding total amount of Rs. 50,000).