ASSISTANT COMMISSIONER OF INCOME TAX Vs. VED PRAKASH

JUDGEMENT

(1.) This is a writ petition filed by the Assistant Commissioner of Income-tax, Investigation Circle 1(1), Hyderabad, seeking issuance of a writ a certiorari calling for the records relating to the order of the Income-tax Appellate Tribunal in M. P. No. 41/Hyd of 1992, dated 29/09/1992, and to quash the same.

(2.) A brief resume of facts is necessary to understand the controversy involved in this writ petition. The first respondent herein filed his returns of income for the assessment year ending 31/03/1985 and the assessing authority accepted the same in its order dated 28/08/1985. The assessee had filed only the income and expenditure account. He has not stated whether he had maintained books of account, not had he produced the balance-sheet or profit and loss account. There was a search of the premises of the first respondent-assessee on 8/12/1987, and gold, cash and books of account were seized. On 7/04/1988, the assessee filed a revised return disclosing and additional income of Rs. 3,25,000 aggregating to Rs. 4,05,341 and a taxable income of Rs. 3,93,310. Subsequently, he filed yet another return disclosing the taxable income to be Rs. 3,11,20 7/01/1989. By notice dated Octo 3/10/1989, the Assessing Officer required him to produce all books of account on 18/10/1989. In his note dated 22/12/1989, the assessee has stated that the return dated 31/01/1989, was full and complete, since it was supported by books, balance-sheet, profit and loss account, etc., whereas the previous return was not so supported. In the ledger page relating to the hand loan account of the previous year 1984-85 corresponding to the assessment year 1985-86, which seized in the seizure conducted on 8/12/1987, there was an entry of an opening balance of Rs. 3,07,000 as on 1/04/1984. The assessment was completed treating the above entry as indicating "cash credit" which was not properly explained by entries in the books or otherwise. The amount of Rs. 3,07,000 was assessed by orders dated 23/03/1990, as unexplained income of the first respondent-assessee.

(3.) The taxable income was determined as Rs. 9,25,252 as against the returned income of Rs. 68,310. The first respondent assessee filed an appeal before the Commissioner of Income-tax (Appeals), Hyderabad, and later a second appeal before the Income-tax Appellate Tribunal. A Division Bench of the Tribunal dismissed the second appeal holding that the assessee had not offered any explanation, not did he produce the balance-sheet or books of account which could have explained the relevant cash credit entry. That order was passed on 18/03/1992.