COMMISSIONER OF INCOME TAX Vs. VENKATESWARA TIMBER DEPOT

JUDGEMENT

(1.) As directed by this Court, the Tribunal, Hyderabad, referred the following two questions under s. 256(2) of the IT Act, 1961, for consideration of this Court :

(2.) The assessee is a registered firm carrying on business as

(3.) Learned counsel for the Revenue contends that the Tribunal should not have entertained the plea of set off for the first time before them and that there was nothing wrong in making both the additions, i.e., cash credits and unaccounted gross profit. We are not inclined to agree with this contention. The question of allowing the plea of set off was held to be a question of fact. The Supreme Court ruled in CIT vs. Nelliappan (1967) 66 ITR 722 (SC) : TC 8R.924 :