1994 (10) TMI 38 - HC - Income Tax

Summary

Issues:
1. Deletion of medical attention charges from assessment.
2. Deletion of operation theatre and other charges.
3. Burden of proof regarding addition sustained by the Commissioner.

Analysis:

Deletion of Medical Attention Charges:
The primary issue in this case was the deletion of medical attention charges from the assessment. The assessee claimed that charges collected from patients for specialist services rendered by doctors were paid over to the specialist doctors and not income of the hospital. The Tribunal found that the amount in question had indeed been paid to the specialist doctors based on seized working sheets and envelopes with slips containing the amount due to doctors from patients. Two doctors admitted receiving the cash for services. The Tribunal concluded that the amount was not the income of the assessee and deleted the addition under this head. The court declined to refer the first question raised by the Revenue, as the Tribunal's finding was supported by evidence.

Deletion of Operation Theatre and Other Charges:
Another addition deleted by the Tribunal was related to operation theatre and other charges amounting to Rs. 3,81,950. The assessee claimed remission to patients, resulting in the omission of these charges in bills for certain operations. The assessing authority noted cases where such charges were omitted. The Tribunal found a question of law arising from this deletion and decided to refer it to the court under the Income-tax Act. The court agreed that a question of law existed regarding the deletion of operation theatre and other charges, and it was necessary to refer it for further consideration.

Burden of Proof:
The third issue involved the burden of proof regarding the addition sustained by the Commissioner. The Tribunal's decision to delete the addition under the head of operation theatre charges raised a question of law. The court directed the Income-tax Appellate Tribunal to state a case and refer the question of law for the court's decision. The court declined to refer the first question raised by the Revenue but agreed to address the issues related to operation theatre charges based on the evidence and materials presented during the proceedings.

In conclusion, the judgment addressed the deletion of medical attention charges, operation theatre and other charges, and the burden of proof regarding additions sustained by the Commissioner. The court's decision was based on a thorough analysis of the evidence and materials presented during the proceedings, ensuring that questions of law were appropriately referred for further consideration.