MARWARI STORES Vs. COMMISSIONER OF INCOME-TAX

JUDGEMENT

(1.) The Income-tax Appellate Tribunal, Patna Bench, Patna, has referred under Section 256(2) of the Income-tax Act, 1961 (hereinafter called "the Act"), the following two questions, for the opinion of this court :

(2.) The facts leading to the above reference are the following :

(3.) On the very same date (i.e., March 18, 1976), one Shri Durga Prasad, partner of the assessee-firm also gave a statement before the Income-tax Officer and in his statement he has categorically stated that he was not even distantly related to B.N. Jain who was supposed to have kept 150 bags of sugar in the godown. Thereafter, the Income-tax Officer contacted S.K.G. Sugar Mills relating to the sugar bags in question. A letter was issued by the sugar mills on March 1, 1977, stating that B.N. Jain has taken delivery of 150 bags of sugar on April 26, 1973. It was also stated that a sum of Rs. 96,031.40 was paid by B.N. Jain of M/s Shri Ram Kesrimal of Dehri-on-Sone. On these premises, the Income-tax Officer, disbelieving the version put forward on behalf of the assessee that 150 bags of sugar belonged to B.N. Jain, for the reasons stated in the order dated February 1, 1979, found that 150 bags of sugar belonged to the assessee. On that basis, a sum of Rs. 52,058 was included representing the sale value of sugar estimated profit on sale and estimated expenses.