HASTIMAL S Vs. COMMISSIONER OF INCOME TAX

JUDGEMENT

(1.) THE question referred under section 66 of the Indian Income-tax Act is :

(2.) THE assessee was a partner of the firm of Messrs. Hastimal Jayantilal and Co., Coonoor. THE firm was dissolved in 1952 and the assessee thereafter carried on business in his individual capacity. In the course of assessment proceedings of the firm it was noticed that the assessee had invested therein a capital of Rs. 63,000 during the period July, 1947, to November 1947. THE assessee represented that he contributed the capital by borrowing from third parties. THE Income-tax Officer was satisfied that to the extent of a major portion of the amount the assessees version was true. He, however, did not accept the case of the assessee in respect of a borrowal of Rs. 25,000 from one Vijayaram Ganeshdas of Bikaner. He initiated proceedings under section 34 of the Act in regard to the assessment year 1948-49. THE explanation of the assessee that Rs. 25,000 was obtained as a loan from Vijayaram Ganeshdas was not accepted. THE Income-tax officer held that the assessee failed to prove "beyond doubt" the origin of the credit of Rs. 25,000. THE said amount was treated as income of the assessee from undisclosed sources for the year 1948-49.

(3.) THERE is no proof that Rs. 8,000 credited to the assessee in the firms accounts really came out of the borrowal of Rs. 25,000 from Vijayaram Ganeshdas. The cheque in favour of Poonamchand was dated 8th August 1947, but the debit in favour of Poonamchand in the firms accounts is dated 13rd November, 1947. THERE is an interval of about three months between the date on which it is alleged that Poonamchand was paid by the assessee and the date on which the assessee obtained the credit at Coonoor. Nor is there anything to show apart from the assessees own statement that this Rs. 8,000 formed part of his borrowing from Vijayaram. As stated already, the assessees first version explaining the Rs. 10,000 contributed to the firm was totally different from the second version. We are not prepared to say that the Tribunal had no materials to disbelieve this part of the assessees explanation.