COMMISSIONER OF INCOME TAX Vs. ATMA RAM MODI

JUDGEMENT

(1.) THIS is a reference under Section 256(1) of the Indian Income-tax Act, 1961 (hereinafter referred to as the : Act), by the. Income-tax Appellate Tribunal, Patna Branch, referring the following question for the opinion of this Court, namely, whether, on the facts and circumstances of the case, the sum of Rs. 3,400/- can legally be deducted from the assessment of the assessee.

(2.) THE assessee is a Hindu undivided family, of which Shri Atma Ram Modi is the Karta. His income was derived partly from the profits on his shares in two registered partnership firms, known as Bhimraj Banshidhar Daltonganj, on the one hand, and Bhimraj Banshidhar (Construction) on the other. THE assessee's shares out of the profits of the said two firms for the assessment year 1963-64 was given as Rs. 24,359. This figure was not challenged. But the assessee claimed a deduction of Rs. 3,400 for the maintenance and depreciation of his motor Car, which, according to him, was used wholly and exclusively for the purposes of his business. THE Income Tax Officer and the Appellate Assistant Commissioner disallowed this claim relying mainly on Sub-section (3) of Section 67 of the Act, which is as follows:

(3.) HERE, the necessary facts are that the expenditure was wholly and exclusively expended for the purposes of business. This statement was not challenged and the Tribunal, as a final court of fact, has definitely found that the entire sum of Rs. 3,400 was expended wholly and exclusively for the purpose of the business of the firm. The assessee's right to claim exemption cannot, therefore, be defeated.