COMMISSIONER OF INCOME TAX Vs. RAMPURSHOTTAM AGRAWAL

JUDGEMENT

(1.) THE applicant wants this Court to answer two questions suggested in Para 3 of the application under S. 256(2) of the IT Act, 1961. These questions are as under:

(2.) THE relevant facts are that in search and seizure operations under S. 132 of the Act at the assessee's residence and business premises cash amount of Rs. 2,08,606 was detected, out of which Rs. 2 lakhs were seized. At the time of search, the assessee had stated that out of that amount a sum of Rs. 1,75,000 was given to him by his brother, Vedprakash, and the rest belonged to his wife and mother. During the proceedings under S. 132(5), the assessee contended that the said amount was cash of the International Exim Corporation brought by Shri Premchand who looked after cash of that firm and the rest of the amount of Rs. 15,000 and Rs.19,000 was of his wife and mother, respectively. The AO completed the assessment on 31st March, 1983, adding Rs. 34,000 being the amounts that belonged to the wife and the mother of the assessee, in his total income. The CIT in exercise of his power under S. 263 set aside that assessment order on 15th Jan., 1985, and directed the ITO to do the assessment afresh after making necessary enquiries.

(3.) IT , however, appears that after the direction was given under S. 263 by the CIT to the ITO to proceed afresh, the ITO had proceeded with the matter afresh since there was no stay granted of that order of the CIT. The de novo assessment order was made against the assessee, but in the appeal filed by the assessee against that order, the CIT(A), by his order dt. 28th Dec., 1990, partly allowing the appeal, came to the conclusion that the source of cash of Rs. 1,75,000 had been satisfactorily explained by the assessee and, therefore, it was not fair and reasonable to treat the same as unexplained income. The appellate authority, therefore, deleted the addition of Rs. 1,75,000 from the income of the assessee. It is stated on behalf of the Revenue that the Revenue has not challenged the said order of the CIT(A) which has been made in favour of the assessee after the matter was remanded by the CIT by an order under S. 263. In this view of the matter, any exercise that may be undertaken for deciding the question as to whether the CIT had jurisdiction under S. 263 or not would be an exercise in futility and purely an academic exercise which we do not propose to undertake. This application is, therefore, rejected. Rule is discharged with no order as to costs.