V RAMASWAMY AYYANGAR Vs. COMMISSIONER OF INCOME TAX

JUDGEMENT

(1.) THE following thirteen questions have been referred in pursuance of an order of this court under section 66(2) of the Indian Income-tax Act, 1922 "(1) Whether, on the facts and in the circumstances of the case, the addition to the income returned to the extent of Rs. 5, 000 was justified on the materials?(2) Whether, on the facts and in the circumstances. of the case, the addition of Rs. 1, 719 to the income returned is justified ?(3) Whether, on the facts and in the circumstances of the case, the addition to the income returned to the extent of Rs. 5, 000 was justified on the materials?(4) Whether, on the facts and in the circumstances of the case, the addition of Rs. 2, 264 to the income returned is justified ?(5) Whether, on the facts and in the circumstances of the case, the addition of Rs. 479 to the income returned by the assessee is justified?(6) Whether, on the facts and in the circumstances of the case, the addition to the income returned to the extent of Rs. 3, 000 was justified on the materials?(7) Whether, on the facts and in the circumstances of the case, the addition of Rs. 2, 713 to the income returned is justified ?(8) Whether, on the facts and in the circumstances of the case, the addition of Rs. 4, 060 to the income returned by the assessee is justified ?(9) Whether, on the facts and in the circumstances of the case, the addition of Rs. 2, 644 to the income returned by the assessee is justified ?(10) Whether, on the facts and in the circumstances of the case'. the addition of Rs. 2, 890 to the income returned is justified ?(11) Whether, on the facts and in the circumstances of the case, the addition of Rs. 5, 189 to the income returned by the assessee is justified ?(12) Whether, on the facts and in the circumstances of the case, the addition of Rs. 6, 253 to the income returned by the is justified ?(13) Whether, on the facts and in the, circumstances, of the case, the addition of Rs. 7, 924 to the income returned by the assesses is justified ?" *THE assessee is an industrialist of Coimbatore. He also owns some agricultural lands. He is a partner in a firm called Krishna & Co., which is the managing agent of a textile mill called Kadiri Mills Ltd.

(2.) THE assessee had drawn from his business accounts during the assessment years 1950-51, 1952-53 and 1953-54 Rs. 4, 445, Rs. 1, 991 and Rs. 1, 769, respectively, towards his personal expenses. Of the drawing of Rs. 4, 445 for the year 1950-51, a sum to the extent of Rs. 2, 137 was towards specific 'items of purchase of jewellery, travelling expenses, etc. That left a balance of Rs. 2, 308 only for family expenses during that year. THE Income-tax Officer considered the above drawings as too low for the status of the assessee. THE explanation offered by the assessee was that his wants were few and his style of living was simple. THE Income-tax Officer did not accept this explanation. He considered that having regard to the status of the as and the standard of living, the expenditure should have been not less than Rs. 12, 000 a year. In that view he came to the conclusion that a sum of Rs. 10, 000 should have been made out of the concealed income in the two assessment years 1950-51 and 1952-53, and that a sum of Rs. 8, 000 should have been made from the concealed income in the assessment year 1953-54. Though the Income-tax Officer estimated undisclosed sources of income for 1953-54 also at Rs. 10, 000, he apportioned a sum of Rs. 8, 000 towards personal expenses and Rs. 2, 000 as unaccounted investment in the name of his wife.

(3.) THE sale proceeds were originally credited to the assessee's account, though, in 1951, he transferred half of the total consideration to the Credit of Laxmi Ammal's account in his books. THEre was no direct evidence to prove that it was Pappammal who gave money for the purchase of the land and that the land was purchased in the name of the minor for the benefit of Laxmi Ammal. THE Appellate Assistant Commissioner was also of the view that it was not possible for Laxmi Ammal to have saved a sum of Rs. 25, 000 from 1941-48 and that the income from the lands could not have been more than Rs. 750 per yearTHE question for consideration is whether this reference and finding of the Tribunal was justified in law, We are not here concerned with the question whether, as between Laxmi Ammal and her minor son, who was the true and real owner. We are concerned with the question whether the real owner of the property was the assessee and whether the deposit of Rs. 25, 000 belonged to the assessee. THEre can be no doubt that the burden of proof was on the department to show that the real owner was the assessee and the amount belonged to the assessee. THE amount is credited in the accounts of Krishna & Company in the name of Laxmi Ammal and the natural presumption is that it belonged to Laxmi Ammal. THE Tribunal had nowhere found that the consideration or any portion thereof for the purchase of the land was advanced by the assessee. THE document itself stands in the name of the minor son. No reason also has been given as to why the assessee should have purchased the land in the name of his minor son.