1992 (8) TMI 11 - HC - Income Tax

Summary

Issues Involved:
1. Justification of Tribunal in reversing the Commissioner of Income-tax (Appeals) decision and restoring the addition of Rs. 3,00,000 as income from undisclosed sources.
2. Tribunal's reliance on material or evidence contrary to the Commissioner of Income-tax (Appeals).
3. Applicability of the principles of res judicata and estoppel.
4. Tribunal's stance on the return filed for the assessment year 1971-72 disclosing Rs. 3,30,000.
5. Tribunal's justification in treating Rs. 3,30,000 as income from undisclosed sources in light of pending disciplinary and criminal cases.

Summary:

Issue 1: Justification of Tribunal in Reversing the Commissioner of Income-tax (Appeals)
The Tribunal reversed the Commissioner of Income-tax (Appeals) decision, asserting that the assessee failed to establish the source of Rs. 3,00,000. The Tribunal noted the inconsistent statements made by the assessee and concluded that the assessee's claim of the money being a capital receipt from East Pakistan was unsubstantiated.

Issue 2: Tribunal's Reliance on Material or Evidence
The Tribunal found that the Income-tax Officer had sufficient material and facts, including contradictory statements from the assessee. The Tribunal held that the burden of proof u/s 69 was not discharged by the assessee, leading to the conclusion that the amount was from undisclosed sources.

Issue 3: Applicability of Res Judicata and Estoppel
The Tribunal ruled that the principles of res judicata and estoppel do not apply in taxation matters. Even if the assessee had shown Rs. 3,30,000 as exempt in the return for the assessment year 1971-72, it did not mean the Income-tax Officer accepted it, as this fact was yet to be established.

Issue 4: Tribunal's Stance on the Return Filed for Assessment Year 1971-72
The Tribunal observed that the alleged return for the assessment year 1971-72, showing Rs. 3,30,000 as exempt, was not credible. The Tribunal noted that no copy of the return was furnished, and the assessee's statements were inconsistent. The Tribunal concluded that the filing of the return did not improve the assessee's case.

Issue 5: Tribunal's Justification in Treating Rs. 3,30,000 as Income from Undisclosed Sources
The Tribunal justified treating Rs. 3,30,000 as income from undisclosed sources, considering the pending disciplinary and criminal cases against the assessee. The Tribunal emphasized that the assessee, a low-paid clerk, failed to prove any legitimate source for the substantial amount.

Conclusion:
The High Court affirmed the Tribunal's decision, answering all questions in the affirmative and in favor of the Revenue. The court found the assessee's claims inconsistent and unsubstantiated, leading to the conclusion that the amount in question was from undisclosed sources.