COMMISSIONER OF INCOME TAX Vs. MAIKU LAL HUF

JUDGEMENT

(1.) The Income-tax Appellate Tribunal, Delhi, has referred the following question of law under Section 256(1) of the Income-tax Act, 1961, hereinafter referred to as "the Act", for opinion to this court: "Whether, on the facts and in the circumstances of the case, the Tribunal was justified in deleting an addition of Rs. 1,54,236 from the income of the assessee-Hindu undivided family ?"

(2.) Briefly stated the facts giving rise to the present reference are as follows : The present reference relates to the assessment year 1975-76. The respondent is a Hindu undivided family. It has earned income from money-lending business and share income from a firm in the past up to the assessment year 1974-75. A search and seizure was conducted at the residential and business premises of the respondent on May 30/31, 1974. It may be mentioned here that the accounting period/previous year relevant to the assessment year is from October 27, 1973 to Diwali, 1974, thereby the date of search and survey operation falls in the assessment year 1975-76. Under the search operation ornaments of the total value of Rs. 1,76,736 were found a well. The karta, Maiku Lal denied its ownership at the time of search itself. Sri Ramesh Chandra, a member of the Hindu undivided family, admitted that these ornaments belonged to him. Subsequently, in respect of some of the ornaments which were found in flask and jug, he denied his ownership. The Income-tax Officer treated the ornaments as belonging to the Hindu undivided family, the assessee at the hands of the respondent which was confirmed by the Commissioner of Income-tax (Appeals). However, in appeal before the Tribunal, the Tribunal had accepted the statement made by Sri Ramesh Chandra regarding ownership of the ornament and it had deleted the addition of Rs. 1,54,236.

(3.) We have heard Sri Shambhoo Chopra, learned standing counsel for the Revenue.