RADHESHYAM TIBREWALL Vs. COMMISSIONER OF INCOME TAX

JUDGEMENT

(1.) "Whether, on the facts and in the circumstances of the case and in view of the declaration made by the creditors, viz., Smt. Swati Devi Jhunjhunwalla and Smt. Bhagwati Devi Tibrewalla, under the Finance (No. 2) Act of 1965 and accepted by the CIT, the Tribunal was justified in holding that the credits standing in the names of the said creditors were correctly included by the ITO in the total income of the assessee -petitioner as income from some undisclosed sources ?"

(2.) THE Tribunal, Gauhati Bench, Gauhati ("the Tribunal" for short), has referred the above question along with the statement of the case for the opinion of this Court; the Tribunal had refused to refer the question but the assessee moved this Court and obtained a rule calling upon the Tribunal to refer the question as formulated by this Court.

(3.) THE aforesaid B. S. Jhunjhunwalla -1 is the son of the assessee, given in adoption to his father - in -law. Swati Devi -2 is the assessee's mother -in -law. Shrimati Bhagwati Devi is the wife of the assessee. The ITO called upon the assessee to explain the sources of the aforesaid entries. The assessee stated that the credit in the name of B. S. Jhunjhunwalla had been made out of gift made to him by his adoptive mother (Swati Devi); the latter confirmed it in a separate letter to the ITO. Regarding the other entries the assessee informed the ITO that those belonged to his wife, Bhagwati, but she had deposited them in benam. The two ladies did not appear before the ITO though called upon. The ITO held that there was no reliable evidence as to the source and genuineness of the entries and treated them as the assessee's income from "some undisclosed sources". The matter was taken to the AAC before whom additional evidence was placed. The assessee claimed that in respect of the amount of Rs. 28,000 reflected in entry No. 1 Smt. Swati Devi had made a voluntary disclosure before the CIT which was accepted; it was a part of the voluntary disclosure of Rs. 40,000 and "in the declaration" she had indicated that the sum of Rs. 28,000 was available in the books of account "as paid" to the assessee. She paid Rs. 11,000 as tax. The said amount though appearing in the name of Shri B. S. Jhunjhunwalla, in fact belonged to her, which she had claimed as her income and paid tax on it. As regards the other entries it was claimed by the assessee that Smt. Bhagwati Devi had made a voluntary disclosure before the CIT of Rs. 1,25,000, which included all these items. The disclosure indicated where the amounts were . . Rs.