COMMISSIONER OF INCOME TAX Vs. JANKIDAS KALURAM

JUDGEMENT

(1.) This reference arises out of an assessment on a firm carrying on business under the name and style of Messrs. Jankidas Kaluram in the town of Rewari in Gurgaon district for the year 1943-44, the accounting year ending on December 9, 1942.

(2.) It appears that this firm has got a one-half share in another firm carrying on business in Jaipur State under the name and style of Messrs. Jankidas Kaluram, Sambar Lake. From the facts stated at the Bar, the correctness whereof was not disputed on the respondents behalf, it appears that the account of the Rewari firm is to be found in the account books of the Sambar Lake concern under four different heads. There is first a current account in the name of Jankidas Kaluram, Rewari, regarding goods and cash received from and sent to Rewari. There is secondly an account in the name of Arjan Singh-Kirpa Ram, Arjan Singh being the father of Jankidas. This is a capital account which has not been operated upon for a considerable period and is being carried forward from year to year. There is thirdly an account in the name of Arjan Singh-Kirpa Ram which seems to have been opened during the accounting period, the account being of a new branch established under the above-mentioned name and style at Rewari. The fourth account is in the name of Kirpa Ram Rewariwala, in which a sum of Rs. 26,115 was credited to the said Kirpa Ram Rewariwala on account of the assessees done-half share of the profits in the Sambar Lake business.

(3.) The first account showed remittances of sums aggregating to Rs. 1,34,590 from the Sambar Lake firm to the Rewari firm as against sundry receipts amounting to Rs. 1,05,632. The third account showed remittances aggregating to Rs. 24,770 against cash receipts aggregating to Rs. 121,42-1-6. In the first account in addition to the sundry receipts Rs. 25,895 were credited to the Rewari firm on account of the old balance and Rs. 272 on account of interest. The remittances in the first account were Rs. 2,791 in excess of the total amount of the items shown to the credit of the Rewari firm and the remittances in the third account were Rs. 3,627-7-6 in excess of the receipts. Taking both the accounts into consideration the remittances from Sambar Lake exceeded the receipts and other sums credited to the Rewari firm by Rs. 7,162.