RASOOLJI BUXJI Vs. COMMISSIONER OF INCOME TAX

JUDGEMENT

(1.) THESE eight applications under Section 256(2) of the Income-tax Act, 1961 (hereinafter referred to as "the Act"), have been filed by the assessee on the ground that the Income-tax Appellate Tribunal, Jaipur Bench, Jaipur (for short "the Tribunal"), has declined to refer to this court some of the questions of law proposed by the assessee as arising out of the order of the Tribunal dated December 31, 1977.

(2.) THE facts of the case, in brief, are that the assessee, M/s. Rasoolji Buxji Kathewala, Udaipur, is a firm consisting of 13 partners, which derives income from manufacture and sale of "katha". THE assessee-firm allegedly borrowed money during the assessment years 1955-56 to 1961-62 and 1964-65 on the basis of "hundis". THE assessment for the aforesaid years was completed by the Income-tax Officer without making any addition of the amounts of the alleged "hundi" loans. It appears that on March 30, 1965, the Income-tax Officer, with the prior approval of the appropriate authority, reopened the assessments for all the aforesaid assessment years under Section 147(a) read with Section 148 of the Act on the ground that the alleged "hundi" loans were not genuine and they represented the income of the assessee-firm from undisclosed sources. During the course of the proceedings for reassessment, the assessee made a disclosure application and expressed its desire to make a settlement under Section 271(4A) of the Act, in respect of the borrowings allegedly made on "hundi" basis. After some correspondence had taken place between the assessee and the Commissioner of Income-tax (Central Circle), Delhi, the assessee made another application on June 11, 1969, in which it agreed that the assessments already made may be reopened and suggested that the additions may be made in respect of each one of the aforesaid assessment years in the course of the reassessment proceedings. THE assessee also agreed to the levy of penalty under Section 271(1)(c) of the Act at the rate of 20% of the tax on the difference between the income originally returned for the assessment years 1955-56 to 1961-62 and 1964-65, and the income which may be assessed according to the settlement. It appears that reassessment proceedings were completed in respect of all the aforesaid assessment years in accordance with the settlement agreed upon by the assessee.

(3.) DISSATISFIED with the order passed by the Tribunal dated June 28, 1979, the assessee has filed these eight applications under Section 256(2) of the Act before this court and it was submitted that the Tribunal may be directed to refer the following four questions also to this court, for its opinion: