H S RAINA Vs. INCOME TAX OFFICER

JUDGEMENT

(1.) THIS is an appeal by the Assessee under Section 260 A of the income Tax Act, 1961 from the order of the Income Tax Appellate tribunal, Amritsar Bench, Amritsar.

(2.) IN the year 1991 assessee constructed a house property. The assessee, who was a partner of six partnership Firms carrying on finance business, had not filed his income tax returns for the earlier four to five years contending that his income was not taxable. A notice under Section 148 dated 18th February, 2000 was served on the assessee on 7th March, 2000, whereupon on 11th February, 2002 assessee filed a return of income declaring income of Rs. 21,175/ -. Assessee's case was referred to the Valuation Cell, whereupon the valuation Cell reported that the house was constructed in the year 1991 at a cost of Rs. 17. 00 lacs.

(3.) ASSESSEE did not dispute the valuation. He contended that the cost of construction was financed by the compensation amount of Rs. 17,85,395/- received by his mother in a land acquisition case. A sum of Rs. 17, 85,395. 70 received by a cheque dated 8th april, 1991 issued by the Collector was deposited in the Savings Bank account No, 1968 of the mother of the assessee maintained with the jandk Bank, Nanak Nagar, Jammu. Assessee contended that moneys withdrawn from the said account were utilized for construction of the house. Though the assessee did not make any effort to produce any material to suggest utilization of the amounts so withdrawn for construction of the house, but some of such withdrawals were accepted to have been utilized for the construction purpose. It was accepted that the assessee has been able to establish source of rs. 11,25,000/- for incurring expenses for construction of the said house but failed to account for the source of incurring expenditure amounting to Rs. 5, 75,000/ -.