LADHA TRADERS Vs. COMMISSIONER OF INCOME-TAX

JUDGEMENT

(1.) THIS is a reference under Section 256 (1) of the Income-tax Act, 1961, made at the instance of the assessee to answer the following question of law : "whether, on the facts and circumstances of the case, there is any legal material for the conclusion of the Tribunal that there is concealment of sale to the extent of Rs. 1,40,340 ?"

(2.) THE issue arises for the assessment year 1980-81. The assessee is a dealer in kerosene oil as also other petroleum products such as furnace oil, light diesel oil, etc. In the course of the assessment proceedings, the Income-tax Officer noticed several defects in the books of account. It was noticed that account books had also been seized by the sales tax authorities. It was further noticed that there were several kinds of discrepancies between the sales as recorded in the cash book and sales reflected in the cash vouchers. In the opinion of the Income-tax Officer, sales to the tune of Rs. 1,40,340 were found under-recorded in the cash book when they were compared with the sale vouchers maintained by the assessee. In other words, in the opinion of the Income-tax Officer the sales amounting to Rs. 1,40,340 were in the nature of suppressed sales from the books of account and did not reflect the true account of the assessee. The Assessing Officer accordingly added this amount to the income of the assessee. It is against this addition, the assessee carried the matter in appeal to the Commissioner of Income-tax (Appeals ). The appeal was dismissed. The assessee then filed second appeal to the Tribunal. However, even the second appeal was also dismissed resulting in upholding of the addition made by the Assessing Officer in the total income of the assessee. It is against this addition, the assessee prayed for making a reference to this court which was declined. However, this court then called for the reference and this is how the same has been sent to this court by the Tribunal.

(3.) HEARD Shri G. M. Chafekar, learned senior counsel, with Shri D. S. Kale, learned counsel for the applicant and Shri R. L. Jain, learned senior counsel, with Shri S. Gupta, learned counsel for the non-applicant.