COMMISSIONER OF WEALTH TAX Vs. BANSILAL BANECHAND

JUDGEMENT

(1.) IN this Departmental reference relating to the assessee's assessment for the asst. yrs. 1965 66 to 1968 69, the Tribunal has referred to this Court the following question of law under S. 27(1) of the WT Act, 1957 :

(2.) BRIEFLY stated, the relevant facts are that, for the assessment years 1962 63 and 1963 64, there appeared certain credits in the capital account as well as third parties' accounts in the books of the assesses. Some of these were added as the assessee's income from other sources. The additions were confirmed by the Tribunal. 15th March, 1991 : These cash credits continued to appear as liabilities in the assessee's books in the subsequent years while filing his returns of net wealth for asst. yrs. 1965 66 to 1968 69, the assessee disclosed his net wealth on the basis of the balance sheets, i.e., without reducing the liabilities by such credits. However, the WTO held that these liabilities were not real and represented the assessee's own moneys. Reference was made, in particular, to a letter dt. 26th March, 1970, written by the assessee's income tax representative wherein it was stated that

(3.) THE short question in this reference is whether the fact that the nature and source of certain cash credits was held not to have been satisfactorily explained and the amount represented by them was treated as the assessee's income from undisclosed/other sources for assessment years 1962 63 and 1963 64 and the further fact that, in the subsequent wealth tax proceedings, the liabilities representing those cash credits were added back to the wealth of the assessee on the basis of a letter written by the assessee's income tax representative brings the case within the four corners of S. 18(1)(c). Sec. 18(l)(c) of the WT Act reads as under :