PADAM KUMAR JAIN Vs. COMMISSIONER OF INCOME TAX

JUDGEMENT

(1.) ON an application filed under Section 256(2) of the Income-tax Act, 1961, by the assessee, a Bench of this court directed the Tribunal to draft a statement of the case and refer the following question of law for a decision :

(2.) AS to how the reference has been called for we may note a few facts from the statement of the case sent by the Income-tax Appellate Tribunal, Patna Bench "A", Patna. The assessee, it appeared, filed a suit for recovery of certain money due to him from the Public Works Department of the State of Bihar. The suit was decreed on September 13, 1965, in favour of the assessee for the sum of Rs. 52,386 with costs. The amount so decreed included interest to the extent of Rs. 11,352 for the period from February 8, 1961, to September 13, 1965. The assessee received the decreed amount as well as the interest on March 20, 1967. The assessee did not maintain any books of account. He was a contractor and derived income from contract work and plying of trucks. His income was being assessed on estimate and was on receipt basis. For the assessment year 1967-68, the assessee filed his return of income on August 18, 1968, but did not show the amount of interest received by him in his return. He only disclosed truck receipts and the profit estimated thereon. The Income-tax Officer while completing the assessment included Rs. 11,352, referred to above, as income from other sources. The assessment of this amount for the year 1967-68 was accepted by the assessee as he did not contest the same by filing an appeal and, therefore, the assessment became final. Thereafter, the Income-tax Officer initiated proceedings under Section 271(l)(c) in respect of the addition of Rs. 11,352. He held that the assessee did not disclose this amount in his return and that he was guilty of the charge of concealment. A penalty of Rs. 11,352 was imposed on the assessee. The appeal of the assessee before the Appellate ASsistant Commissioner was dismissed. His further appeal to the Appellate Tribunal also met with the same fate. The Appellate Tribunal dismissed the application of the assessee filed under Section 256(1) of the Act. It was thereafter on an application under Section 256(2) of the Act, that this court called for a reference on the question of law set out above.

(3.) IN this view of the matter, we are unable to subscribe to the view now canvassed before us that the liability regarding the amount of interest was itself in dispute. We do not find the decision of the Supreme Court in CIT v. Hindustan Housing and Land Development Trust Limited [1986] 161 ITR 524, has any application in the present case. We will, therefore, answer the question in the affirmative and in favour of the Revenue. Since the matter is of the year 1967-68, there shall be no order as to costs.