JAGANNATH SALES Vs. COMMISSIONER OF INCOME TAX

JUDGEMENT

(1.) THE assessee having moved this court under Sub-section (2) of Section 256 of the Income-tax Act, 1961, and this court on being satisfied that a question of law arises out of the order of the Tribunal formulated the following question for opinion of this court :

(2.) THE petitioner, a partnership-firm, carried on the business of supply of moong dhal in the district of Sundargarh. When the Government of Orissa in the Community Development Department invited tenders for supply of moong dhal to some districts in the State, the petitioner offered to supply the same to the Collectors of Sambalpur and Sundargarh districts and his offer having been accepted, the petitioner supplied the same. To ensure the supply, the petitioner purchased moong dhal from different millers of Andhra Pradesh and brought the same to Sambalpur either by rail or by truck. During the year in question, the petitioner had purchased 2,905 bags of dhal and it was found from the books of account that 2,315 bags had been sold. But the closing stock was shown to be 357 bags instead of 590 bags and thus there was a shortage of 233 bags. In the course of assessment proceedings for the year 1982-83, the petitioner was called upon to explain the shortage and an explanation was offered. THE Income-tax Officer raised some doubts about the genuineness of a certificate produced by the assessee before him and called upon the concerned officer to confirm the issuance of the certificate from his office. THE concerned officer, however, informed that he did not have any record to show that the claim of the assessee was correct as there was no record in his office. THE Income-tax Officer thereafter called upon the assessee to produce before him the Special Officer who had issued the certificate in question for cross-examination. But the officer was not available. THE assessee had made an application to the Income-tax Officer that the concerned officer who had given the certificate might be summoned under Section 131 of the Income-tax Act at the cost of the assessee or alternatively he might be examined on commission. But that prayer was never acceded to. Finally, the Income-tax Officer disbelieved the certificate but allowed the shortage due to drying up of moisture contents to the extent of two per cent. and made an addition to the tune of Rs. 77,112.