Commissioner Of Income-Tax vs Smt. Usha Jain
1990 Latest Caselaw 7 Del

JUDGMENT

Kirpal, J.

1. In the present case, the respondent had in her books of account credited one Messrs. Gupta and Co. with Rs. 48,476 and one S. Surain Singh with Rs. 48,400. The respondent was constructing a building and the cost of material was debited to the said accounts. The Income-tax Officer came to the conclusion that Messrs. Gupta and Co. and S. Surain Singh did not exist and that those entries were fictitious. He sought to apply section 68 of the Act. The Commissioner of Income-tax (Appeals) came to the conclusion that section 68 was not applicable and remanded the case to the Income-tax Officer for investigating further facts as, according to the Commissioner of the Income-tax, if at all, it is only section 69 or section 69B or section 69C which would be applicable. The Income-tax Officer filed an appeal and the Tribunal held that "section 68 deals specifically with sums credited in the books of the assessed on account of receipt of money". According to learned counsel for the petitioner, section 68 refers only to sums being credited in the books of the assessed and does not specifically state that the said section applies only on account of credits being there because of receipt of money. In our opinion, the question involved is a pure question of law as it pertains to the correct interpretation of section 68. We, therefore, direct the Tribunal to state the case and refer the following question of law to this court :

"Whether, on the facts and in the circumstances of the case, the Income-tax Appellate Tribunal was justified in law in directing that the additions made on account of unexplained cash credits would not be called unexplained cash credits under section 68 of the Act ? "

2. Before concluding, we might mention that learned counsel for the respondent states that the reference is barred by time. We find no merit in this contention. The order of the Tribunal dismissing the application under section 256(1) is dated May 14, 1986. In paragraph 24 of the petition under section 256(2), it is stated that the said order of the Tribunal was received on February 27, 1987. This averment in the petition is supported by an affidavit of the Commissioner of Income-tax himself. Learned counsel for the respondent contends that it is not possible that an order passed on May 14, 1986, was served only on February 27, 1987. Merely on this conjecture, it is not possible for us to conclude that the order dated May 14, 1986, was not served on February 27, 1987. The affidavit of the Commissioner of Income-tax has not been rebutted by the respondent in any way. It was open to the respondent to have placed on record material to show that the service of the order dated May 14, 1986, was or must have been made prior to February 27, 1987. In the absence of any such averment, we see no reason to disbelieve the affidavit of the Commissioner of Income-tax which supports the averment in the petition to the effect that the said order of the Tribunal was received only on February 27, 1987. In our opinion, the petition has been filed within time. This petition is, accordingly, allowed in the aforesaid terms. There will be no order as to costs.