A A HAI Vs. COMMISSIONER OF INCOME TAX

JUDGEMENT

(1.) THE petitioner, in this application, challenges an order, dated 30.09.91, passed by the Special Judge (Economic Offences), Muzaffarpur, in Complaint Case no. 424 of 1991 (Trial No. 2427 of 1991) whereby he took cognizance of offences under Sections 276C and 277 of the Income Tax Act, 1961, and summoned the petitioner to face trial. The order taking cognizance was passed on a complaint filed by the second respondent and the allegations relate to the income tax return filed by the petitioner for the assessment year 1980 -81.

(2.) AT the centre of the controversy is a private clinic named as Hai Clinic. According to the petitioner, it was owned and run by his wife, Mrs. Hasmat Hai, and she, as its proprietor, used to show the income derived from the clinic in the returns of income filed by her. Accordingly, the petitioner in his return for the year 1980 -81 did not show any income from the clinic and declared a sum of Rs.17,400/ - as his total income from medical profession. The Assessing Officer, however, held that the income derived from the clinic exclusively belonged to the petitioner and in no case could it be treated as the income of his wife. He, therefore, added the income from the clinic (Rs.1,25,000/ -) to the income shown by the petitioner in the return filed by him and passed the assessment order on that basis.

(3.) THE petitioner preferred an appeal before the C.I.T. (Appeals). The appellate authority accepted that the income from the clinic was Rs.50,000/ - only (and not Rs.1,25,000/ -) but did not interfere with the finding that the income from the clinic was, in fact, income in the hands of the petitioner. The second appeal filed by the petitioner was rejected by the Income Tax Appellate Tribunal (ITAT), Patna Bench. The Tribunal also turned down his application for making a reference to the High Court in terms of Section 256 (1) of the Act and finally his application under Section 256 (2) of the Act was dismissed by the High Court.