NIRMALDAS JASSUMAL Vs. COMMISSIONER OF INCOME TAX

JUDGEMENT

(1.) IN compliance with the directions issued by this Court on 30th June, 1987 in MCC No. 157 of 1985, presented by the applicant-assessee, under S. 256(2) of the IT Act, 1961 ('the Act'),the Tribunal has stated the case and referred the undernoted question of law for our opinion:

(2.) BRIEFLY stated, the facts of the case are that the assessee was treated as registered firm under s. 185 of the Act. It filed return for the asst. yr. 1978-79 for the accounting period ending Diwali 1977 on 27th June, 1978 declaring income at Rs. 7,385. On scrutiny of accounts, the ITO found cash credit of Rs. 35,000 in the name of Smt. Shilabai, partner of the firm. The ITO did not feel satisfied by the explanation offered and thus, made addition of Rs. 35,000 in the hands of the assessee. On appeal, the AAC accepted the contention of the assessee and deleted the addition. The Revenue, then filed the appeal before the Tribunal. The Tribunal allowed the appeal and held that the amount of Rs. 35,000 was rightly taxed as assessee's income under S. 68 of the Act. The appeal registered as IT Appeal No. 14(Ind) of 1982 for the asst. yr. 1978-79 was allowed (Annexure-E). The applicant-assessee filed an application under S. 256(1) for reference which was rejected. The assessee then filed MCC No. 157 of 1985 under S. 256(2) of the Act. In that MCC, this Court passed the order on 30th June, 1987. The Tribunal, therefore, stated the case and referred the question as noted above.

(3.) SHRI Vyas submitted that the order of the Tribunal is base on proper appreciation of facts and correct application of law. He invited our attention to Shankar Industries vs. CIT (1978) 114 ITR 689(Cal). It is held as under: