KANHAIYA LAL Vs. COMMISSIONER OF INCOME TAX

JUDGEMENT

(1.) THIS is a reference under Section 256(2)of the I.T. Act, 196J, (hereinafter "the Act"). In compliance with the direction given by this court, the Income-tax Appellate Tribunal, Delhi Bench 'C', Delhi, has stated the case and referred the following question of law for the opinion of this court:

(2.) THE brief facts are these. For the assessment year 1964-65 (the previous year ended on 31st March, 1964), the assessee, an individual, was assessed on an income of Rs. 29,000, Rs. 26,000 being unexplained investment in the acquisition of gold alleged to have been seized from the possession of the assessee on April 13, 1963, by the Central Excise authorities at Mathura Junction Railway Station, and Rs. 3,000, estimated income from sarrafa or other business. THE assessee filed an appeal. THE AAC sot aside the assessment order on the ground that no reasonable opportunity had been allowed to the assessee. THE case was remanded to the ITO for making the assessment afresh.

(3.) AN alternate plea was taken before the Appellate Tribunal on behalf of the assessee and it was that the assessee was carrying on this illegal business and any loss resulting in the normal course of such business should be allowed as a deduction. This contention, as well, was repelled by the Appellate Tribunal and in the result the appeal was dismissed.