A CHINA SUBBARAYUDU Vs. COMMISSIONER OF INCOME TAX

JUDGEMENT

(1.) Two questions are referred under section 256(1) of the Income-tax Act, 1961, at the instance of the assessee. They are :

(2.) For the assessment year 1969-70, the assessment relating to the assessee was completed on 28/03/1970, on an income of Rs. 24,640. While making the assessment, several (items of) transport charges said to have been paid by the assessee, in respect of which he produced vouchers of payment, were accepted. Subsequently, on the basis of a report of the Central Bureau of Investigation, it came to light that the vouchers produced by the assessee were fabricated and false. The assessee was also being prosecuted by the Central Bureau of Investigation before the Special Judge in that behalf. Indeed, the report was that the fertilizers, which were allotted to the assessee were not at all transported to the destination points as per the allotment orders, but disposed of at or near about the port and that the assessee created bogus evidence supporting the plea of transport. On the basis of the said information, the assessment was reopened and the said vouchers were rejected. It was held by the Income-tax Officer that the vouchers produced were not genuine and that they were fabricated. The appeals preferred by the assessee to the Appellate Assistant Commissioner and the Tribunal failed, whereupon the present reference is obtained.

(3.) The contention of the assessee before the Tribunal was that the reopening of the assessment under section 147(a) was bad. His case was that inasmuch as he has placed all the basic facts before the Income-tax Officer, he had discharged his duty under Act and that he was not obliged to tell the Income-tax Officer that the vouchers produced by him are not true. This argument which we find, to put it mildly, quite startling was rejected by the Tribunal holding that the assessee failed to furnish the particulars of his income and expenditure truly and fully, the reopening of the assessment was proper.