COMMISSIONER OF INCOME TAX Vs. RADHARAMAN MOHANTY

JUDGEMENT

(1.) THIS is an application under Section 256(2) of the Income-tax Act, 1961 (for short the "Act"), by the Department requiring the Income-tax Appellate Tribunal, Cuttack Bench, Cuttack (for short the "Tribunal"), to state a case and refer the questions of law 'arising out of its order for the opinion of this court.

(2.) THE opposite party-assessee is a doctor having income from salary and from private practice. He had neither maintained any books of account nor a professional diary for his professional income and such income was used to be returned on estimate. For the assessment year 1971-72, the assessee returned his professional income at Rs. 2,000 and the original assessment was completed on that basis.. Subsequently, on receipt of information from Government Departments to the effect that the assessee had received a sum of Rs. 22,724 by way of consultation and injection fees, the Income-tax Officer initiated proceedings under Section 147(a) of the Act. A notice under'section 148 of the Act was issued to the assessee in response to which he reiterated that his professional income was Rs. 2,000 for the year under consideration because he had not received the entire amount for which he had issued certificates but only a small portion being consultation fees only and the major portion was given to the doctors who gave injections. This was not believed by the Income-tax Officer. THE total income of the assessee was assessed at Rs. 26,430 as against the returned income of Rs. 8,433. Penalty proceeding under Section 271(1)(c) of the Act was initiated against him. THE assessee examined two witnesses in support of his contention that he had received consultation fees only and not injection fees. This was not accepted and ultimately penalty of Rs. 16,720 was imposed on him which was confirmed by the Appellate Assistant Commissioner on appeal. THE assessee carried a second appeal to the Tribunal and the Tribunal held that there were no materials for coming to the conclusion that the assessee had either concealed his income or committed fraud or wilful neglect in returning the correct income. He has supported his stand by adducing evidence which, has not been controverted by the Department. Ultimately, the Tribunal set aside the order imposing the penalty and allowed the appeal. Against this, an application under Section 256(1) of the Act was filed before the Tribunal which was rejected. Hence, the present application.