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Issues involved: Assessment of undisclosed income u/s 256(2) of the I.T. Act, 1961 based on marriage expenses claimed by the assessee.
Summary: The High Court of Delhi considered a case where the Tribunal added Rs. 10,000 to the assessee's income for the assessment year 1966-67, based on marriage expenses claimed by the assessee. The assessee, a partner in a firm, claimed that Rs. 9,000 was spent on his son's marriage, partly covered by gifts and a withdrawal from the firm. The Tribunal found discrepancies in the assessee's statements and upheld the addition, concluding it was justified given the circumstances. The main contention was the lack of material to show excess expenditure beyond what was claimed by the assessee. Reference was made to a previous judgment where a similar addition was struck out due to lack of evidence. The court noted that expenditure on the son's marriage is usually borne by the father or joint family, making the addition unusual. However, considering the lack of details and possible undisclosed facts, the court upheld the Tribunal's decision. The court analyzed the facts presented, including evasive answers by the assessee regarding expenses and purchases related to the marriage. It was observed that the expenditure could have been met post-marriage, and the exact amount was known only to the assessee. Given the nature of the marriage, number of guests, and customary gifts, the court found the addition of Rs. 10,000 to be justified, as Rs. 9,000 claimed by the assessee seemed inadequate. In conclusion, the court ruled in favor of the Department, upholding the Tribunal's decision to add Rs. 10,000 to the assessee's income as a reasonable estimate. The court acknowledged the difficulty in determining the exact amount and left the parties to bear their own costs.
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