9911796707
TMI Blog1998 (4) TMI 177X X X X Extracts X X X X X X X X Extracts X X X X ..... of being heard ? 4. Whether on the facts and in the circumstances of the case, the Tribunal was legally justified in refusing the assessee's right to cross examine the persons whose statements were relied on by the ITO against the assessee and further vitiated by its failure to examine key persons including Shri Amarlal Kishandas and Sundaram Pillai whose testimony was essential to ascertain the true nature of the transaction in Kalmanda property. 5. Whether on the facts and in the circumstances of the case, the Tribunal was legally justified in rejecting the contention of the assessee that a sum of Rs. 110 lakhs was only connected to the transaction of sale of the Kalmanda property and did not represent the sale consideration without considering the relevant facts, materials and evidence ? 6. Whether on the facts and in the circumstances of the case the findings of the Tribunal that the assessee had sold the Kalmanda property for Rs. 110 lakhs and that he is assessable to the capital gains tax on the same apart from what is specifically excluded by the Tribunal is vitiated ? 7. Whether on the facts and in the circumstances of the case the finding of the Tribunal that Shri ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ntial and business premises on 16-3-1984 and in the course of search the authorities have recovered a number of incriminating documents including certain agreements which the assessee was alleged to have entered into with one S. Gopal. The assessee did not file his return within the time. Therefore, the Assessing Officer issued notice. Thereafter the assessee had filed his return admitting the capital gains on the sale price at Rs. 2.10 lakhs per ground. The Assessing Officer did not accept the same. Therefore, even while the assessment proceedings were pending he issued a notice under section 271(1)(c) on 22-1-1987. As there was no reply the Assessing Officer sent another letter dated 29-1-1987 pointing out various items in respect of which there was concealment of income. Later the assessee sent a reply stating that he had approached the Commissioner of Income-tax for settlement for the assessment years 1978-79 to upto date. Again by another letter dated 3-3-1987, the assessee has stated to the Assessing Officer that a revised return admitting a net profit of Rs. 16,64,000 was filed but no such return was actually filed. On being reminded by the Assessing Officer through another ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y another letter he has stated that he had filed a revised return admitting a net profit of Rs. 16,64,338 though he did not file any such return. On further reminder a revised return was filed on 10-3-1987 declaring a net profit of Rs. 14,07,390. The Assessing Officer has issued notice basing oil various seized material as well as the statements recorded from various persons connected with the sale transaction. Therefore, the Assessing Officer recorded a finding on 10-3-1987 that the case attracts the provisions of section 271(1)(c) thereby implying that an extended time provided under section 153(1)(b) is available to the Assessing Officer for completing the assessment. When a specific notice was given by the Assessing Officer stating that the case attracts the provisions of section 271(1)(c) a longer period of limitation provided under section 153(1)(b) is available and the assessment completed by the Assessing Officer was within the time provided under section 153(1)(b). Therefore, this Tribunal concluded that the assessment as framed was not barred by limitation. The said finding was based on a fact that the Assessing Officer has recorded a finding that the case attracts the pr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ird question relates to the claim of the assessee that proper opportunity of being heard was not given. This issue was considered by this Tribunal in para 72 of its order. The claim of the assessee was that he was not given sufficient opportunity to explain his case. Admittedly, the assessment proceedings were started on 17-8-1984 by issue of a notice under section 139(2). Only after the issue of notice under section 142(1) and after taking various adjournments the assessee has filed his return of income on 31-12-1985. Thereafter the case was posted on number of occasions and the matter was pending before the Assessing Officer till 14-3-1988 when it was finally heard and concluded the hearing. The contention of the assessee was that he filed a letter dated 8-3-1988 seeking an opportunity of being heard and, thereafter he was not given an opportunity of being heard. This Tribunal has considered this issue elaborately. After considering various decisions cited by the assessee before this Tribunal, the Tribunal concluded that the letter which the assessee has alleged to have been filed on 8-3-1988 was not a mere letter seeking an opportunity of being heard but it was an explanation fi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... al grounds before this Tribunal for the first time the assessee has raised this ground. When the assessee was aware of all the statements recorded by he authority and even obtained copies of the statements and when he did not show any interest to cross-examine those persons at the stage of assessment proceedings, the claim by the assessee at this belated stage, this Tribunal concluded, is only an afterthought by the assessee to wriggle out of the situation from the liability to capital gains out of the sale transaction of the property in question. Therefore, this Tribunal negatived this claim of the assessee. In so far as examination of other persons claimed by the assessee, according to the Assessing Officer they are not relevant persons to be examined for the purpose of determining the issue in dispute. The issue in dispute was about the sale consideration in respect of the Kalmanda property. For that purpose the persons named by the assessee are not relevant. In view of the findings arrived at by this Tribunal, the question is not at all a referable question of law. 8. Questions 5 to 8 relate to the conclusion of this Tribunal that the total consideration was Rs. 110 lakhs and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nt with Gopal was only colourable one. Therefore, this Tribunal concluded that the assessee was the beneficiary of the total consideration of Rs.110 lakhs and directed the Assessing Officer to compute the capital gains tax accordingly. However, in the miscellaneous petition filed by the assessee this Tribunal has directed the Assessing Officer to allow the relief while computing the capital gains in respect of any payment made to Amarlal Kishandas, over and above the refund Rs. 10 lakhs received as advance, if the same is supported by proper evidence. Therefore, the said conclusion of this Tribunal is based on the material on record and the finding is only a finding of fact and the same does not give rise to any referable question. Therefore, the questions 5 to 8 are rejected as not referable questions. 9. The next question relates to the failure to invoke the provisions of section 52(2) of the Act. According to the assessee the stated consideration is Rs. 2.10 lakhs per grounds. If it is the case of the departmental authorities that the assessee had received some amount over and above the stated consideration, then the course open to the assessing authorities to invoke the provi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ch are on record. The assessee upon receipt of the order of the Tribunal dated 30-6-1994 filed a Miscellaneous petition and has made written submissions as well as oral submissions. One of the submissions in the Misc. Petition was that certain points or aspects or submissions made before the Tribunal were not considered by the Tribunal in its order dated 30-6-1994, however, the Tribunal took the view that points not specifically dealt with should be deemed to have been decided against the assessee. The Misc. Petition was ultimately dismissed. 2. In this backdrop, I have carefully gone through the order proposed by the learned Judicial Member. With very great respect I am unable to agree with his finding that the issues involved in the questions raised by the assessee are questions of fact only, not giving rise to any question of law. 3. The first question is about the limitation. There was a search in the assessee's residential and business premises on 16-3-84 and in the course of the search the authorities recovered certain documents and agreements. The assessee filed his return of income on 31-12-1985. Copies of the statements recorded in the course of the search were provi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in the assessment. Either the statement should be recorded in the presence of the assessee or, if it is recorded otherwise the assessee should be given an opportunity to cross examine the persons who have deposed against the assessee. Whether mere posting of the case on a few days for hearing without making available the persons from whom the statements were recorded would constitute sufficient opportunity to the assessee, is a debatable issue. The Assessing Officer in his order (para 10.5 page 8 of his order) had stated that he would be dealing with the assessee's contention and objections contained in his letter dated 8-3-88, but he had not dealt with the same in any part of his order. Further, in this case the draft order was dated 28-3-1988 and the assessment order also was of the same date and the I.A.C. while granting approval to the order on 30-3-1988 had remarked that it would have been better if the contentions of the assessee had been met. The Misc. Petition on that score also stood rejected by the Tribunal. In such circumstances, in my humble opinion the question about the lack of opportunity gives rise to a mixed question of law and fact and, therefore, it is fit for re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ith all the agreement holders and it was he who settled the claim of various agreement holders, including Sri Amarlal Kishandas. Therefore, it was contended that the needle of suspicion could as well. be upon Ramesh. It was also contended that there were atleast two holders of earlier agreements in respect of the very same property and out of that Amarlal Kishandas was in possession of the original title deed and he had gone to the Court over the agreement and if he had come to know that the real consideration of Rs.110 lakhs, it was inconceivable that he was just satisfied with Rs. 12 lakhs in draft and Rs. 7 lakhs in cash. Therefore, it was urged that it should be held that the consideration must have been shared by various persons and not by Govindaswamy, alone. The assessee urged before the Tribunal that if proper weightage had been given to the above facts the Tribunal could not have come to the conclusion that the assessee is the sole beneficiary of the transaction of Rs.110 lakhs. In view of these contentions which are found in the written submissions filed before the Tribunal in the course of the original hearing of the case as well as in Miscellaneous Petition. I am of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssessing Officer proceeded that the cash portion of the sale consideration was utilised by the assessee in the purchase of shares from Sundaram Pillai and so he was the beneficial enjoyment of the said sum is not supported by facts. (pages 100 and 101 of the written submissions filed by the assessee before the Tribunal). It is now urged before us that if proper weightage is given to the points made in the written submissions, the Tribunal could not have come to the conclusion it has reached in its order dated 30-6-94. In my considered view these are not mere ifs and buts, whether proper weightage has been given to the above contentions would itself form a mixed question of fact and law. 10. This apart, in the context of allegations of non-compliance of the principles of natural justice at the time of the assessment, it is a moot point whether the conclusion reached by the Tribunal as against the assessee would remain only as questions of fact. In my considered opinion all the above questions are mixed question of law and fact and therefore, a reference would lie. 11. Question No. 9 is purely academic and therefore, I agree with the learned Judicial Member that no reference woul ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lai whose testimony was essential to ascertain the true nature of the transaction in Kalmanda property?' (5) "Whether on the facts and in the circumstances of the case, the Tribunal was legally justified in rejecting the contention of the assessee that a sum of Rs.110 lakhs was only connected to the transaction of sale of the Kalmanda property and did not represent the sale consideration without considering the relevant facts, materials and evidence?" (6) "Whether on the facts and in the circumstances of the case the findings of the Tribunal that the assessee had sold the Kalmanda property for Rs.110 lakhs and that he is assessable to the capital gains tax on the same apart from what is specifically excluded by the Tribunal is vitiated?" (7) "Whether on the facts and in the circumstances of the case the finding of the Tribunal that Shri Amarlal Kishandas was paid only a sum of Rs. 12 lakhs in settlement of his account with the assessee is vitiated by its failure to consider all the relevant facts, materials, and evidence?" (8) "Whether on the facts and in the circumstances of the case, the finding of the Tribunal that the assessee was the sole beneficiary of the cash elemen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... -1987 by the Assessing Officer, the revised return was filed on 10-3-1987 declaring a net profit of Rs. 14,07,390 which is at variance with his earlier letter. As the income declared in the revised return was at variance with the original return, the Assessing Officer recorded this fact after providing the assessee an opportunity of being heard and extended the time for completing the assessment, as the material on record required further investigation. The Assessing Officer after conducting further enquiry into the matter framed the assessment on 28-3-1988. 2.3 The main issue relates to the capital gains arising out of the sale of the what is known as Kalmanda property. The brief facts relating to this property are as follows: This property admeasuring about 27 grounds is situated on the Nungambakkam High Road. This property was originally purchased by Smt. Velugotti Lakshmi Pappaya Raogaru alias Srideviamma, under a deed of sale dated 4-2-1942. It was covered by certain old dilapidated building and got it demolished thereby converting the building site into a vacant land, which was divided into four convenient plots 1 to 4 after obtaining the necessary sanction. In the year 197 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 0 lakhs and the assessee had received a sum of Rs. 10 lakhs as advance. As per the said agreement, the sale price works out to Rs. 2,83,167 per ground. Later, the assessee had negotiated for the sale of the above said property, together with another property admeasuring 8 grounds 1434 sq.ft. with one Arumaidurai at the rate of Rs. 4.25 lakhs per ground in March, 1982 on behalf of one Mr. Jain of Calcutta and received a sum of Rs. 2 lakhs as advance. In both the above cases, the assessee did not honour the commitment, as the prices of land in the city were registering a steep rise. The assessee also negotiated with O.N.G.C. for the construction of a commercial complex. In the negotiations on behalf of the assessee, the site was offered to the O.N.G.C. at a price of Rs. 4.5 lakhs per ground. But the transaction did not fructify. Ultimately, the entire site of about 27 grounds belonging to the assessee, M/s. Century Flour Mills and the property purchased by the assessee from Smt. Srideviamma under an agreement of sale, was sold to M/s. Gotham Construction Company represented by Shri N. Ramesh under four registered sale deeds executed on 10-8-1983. According to the assessee, the proper ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the cost for the purpose of short term capital gains. Though it was contended by the assessee that the assessee has not acquired any fights over the land and hence no capital gains could be computed in respect of the said transaction, the Assessing Officer overruled those objections. Hence, he computed the short term capital gains at Rs. 11,90,065. 2.7 Aggrieved by the order of assessment, the assessee preferred appeal to the CIT(A). As appeals were filed both by the assessee and M/s. Century Flour Mills, the CIT(A) considered the issue relating to capital gains of the Kalmanda property in the appeals filed by M/s. Century Flour Mills which was followed in the appeal filed by the assessee. Before the CIT(A) the assessee reiterated all the contentions raised before the Assessing Officer. Apart from that, it was also contended that the burden to prove that there was under statement of sale value is on the department and the department had not discharged the burden. Another contention was that even if some other persons had received the amounts over and above the declared amounts in the sale deeds, such amount cannot be said to belong to the assessee. Another contention was that 8 g ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Andhra Bank Manager, Main Branch, Lingichetty Street, who has deposed that the beneficiary of the drafts has Left the bank after signing of the drafts and the amount was collected and taken away by two other persons, namely P. Govindaswamy and N. Ramesh, who had identified the beneficiary. The CIT(A) also held that the provisions of section 52(2) of the I.T. Act are applicable as the conditions stipulated therein are complied with. The stated consideration as per the sale deeds executed by the assessee was at the rate of Rs. 2.10 lakhs per ground, whereas the evidence showed that the total consideration paid by the purchasers was Rs.110 lakhs, which works out to about Rs. 4.20 lakhs per ground. The CIT(A) also gave a categorical finding that the assessee was guilty of tax evasion since he had intended to evade taxes through devising a strategy in which an intermediary, Shri Gopal, was deliberately roped in with a view to show that he had received only half of the payment. There is not only documentary evidence to establish that the sale value of the total land was at Rs.110 lakhs, but also direct evidence to prove that the entire amount of money was paid to the assessee. There are ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... not raised before the CIT(A). The assessee's contentions that a sum of Rs.110 lakhs was only connected to the transaction of sale of Kalmanda property and did not represent sale consideration are not correct. The assessee had sold the Kalmanda property for Rs.110 lakhs and that he is assessable to capital gains tax on the same. Shri Amarlal Kishandas was paid only a sum of Rs. 12 lakhs in settlement of his accounts with the assessee. The assessee was the sole beneficiary of the cash element relating to the sale of the Kalmanda property in its entirety. The failure to invoke the provisions of section 52(2) of the Income-tax Act has not vitiated the assessment. 2.12 The assessee thereafter filed miscellaneous application under section 254(2) of the Income-tax Act challenging the order of the Tribunal as the one wherein mistakes have crept into it as apparent from record. After hearing the parties, the Tribunal dismissed it on 10-11-1995. Consequently the assessee has come on reference application seeking to refer the questions stated to be of law as in paragraph 1 referred to above. While there was no difference of opinion between the learned Members both in the second appeal as we ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ons of limitation would also apply, All statements were recorded even before 29-1-1987 and that only copies thereof were not granted till January, 1988 besides the fact that the investigation was over before 29-1-1987. In effect, the order of the Accountant member allowing the reference application the relevant portions being at pages 201 and 202 of the paper book at para 3 4 is relied upon. 3.2 On the other hand, the learned Representative for the Revenue countered, to the same extent as submitted before the Tribunal in the reference application by also relying upon the order of the Judicial Member who has rejected the reference application, the relevant portions being at pages 191 and 192 of the paper book at para 4. 3.3-1 Rival submissions heard and relevant orders read. On the first point of limitation, this issue is dealt with elaborately in the operative paragraphs from 44 to 53 of the order of the Tribunal in the appeal, while it is dealt with at paragraphs 191 to 192 of the order of the Judicial Member and 201 to 202 of the order of the Accountant Member in the reference application. The plea of the Revenue is that the finding of the Tribunal is based on facts and no qu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... first contention of the assessee is that the first return of income filed on 31-12-1985 was only a provisional one and hence no concealment can be detected from a provisional return. This is a case in which even after search on 16-3-1984 no return was filed by the assessee till 31-12-1985, in spite of several notices and reminders being sent to the assessee. Though in the return filed on 31-12-1985, the assessee had proposed to file a revised return, delay in filing such a return will not render the first return a provisional one. In fact, though hearings were started from 19-1-1985 and many adjournments were taken, the assessee did not file any revised return as proposed by him. Only after issue of notice under section 271(1)(c) served on 24-1-1987 and subsequent letter dated 29-1-1987 proposing additions, the assessee wrote a letter dated 9-2-1987 stating that he was going to the CIT for settlement. Again a letter dated 3-3-1987 was filed proposing to file revised return showing net profit of Rs. 16,64,338, but it was not done. On being reminded, the assessee ultimately filed revised return on 10-3-1987 declaring net profit of Rs. 14,07,390 which is at variance with the earlier f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tion. In the decision of the Hon'ble Madhya Pradesh High Court cited the issue was whether in a case where the Assessing Officer invoked the provisions of section 142(2C) and the assessee informed on 22-8-1985 that the audit report will not be available, the Assessing Officer was justified in completing the assessment on 3rd of September, 1985. In these circumstances the High Court held that as the assessee's letter regarding non availability of audit report was received by the Assessing Officer on 22-8-1985, the Assessing Officer should have completed the assessment on that date and not waited till 3-9-1985 to complete the assessment. In such circumstances, the assessment was held to be time barred. The facts in the case before the Madhya Pradesh High Court are totally different from the facts of the instant case and that, therefore, the ratio decidendi does not in any way apply to the instant case. 3.3-5 The last contention of the assessee is that though all the statements were recorded before 21-1-1987, the copies of the same were given to the assessee in January, 1988. The Revenue countered that the assessee asked for copies of the statements only on 20-1-1988 and the same we ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... aph 'c' thereunder to demonstrate that the stand of the assessee is correct. This aspect of the matter has been discussed at page 44 of the order of the Tribunal in the appeal, i.e. the paragraph being 58, dealing with the issue in detail, apart from page 2 at paragraph 7 of the miscellaneous application. It is also discussed in the statement of facts furnished before the Tribunal in the reference application at pages 140 to 143. The case of R. Rajagopala Reddy has not overruled the case of Mithilesh Kumari v. Prem Behari Khare [1989] 177 ITR 97 (SC). It was held that suits already filed before the coming into force of the Benami Transaction (Prohibition) Act were saved. This was explained in the case of Nand Kishore Mehra v. Sushila Mehra [1995] 215 ITR 218/81 Taxman 418(SC). This view is also endorsed in the Journal section of Smt. Ved Ahuja v. CIT [1996] 222 ITR 53/90 Taxman 496 (Punj. Har.) at pages 59 to 62 under the heading 'Law on Benami Transactions'. The Tribunal has also examined the case of R. Rajagopala Reddy in the Wealth-tax Appeals at pages 156 to 165 of the paperbook at paragraphs 8 onwards. The fact is that the assessee did not file any suit against the benamidar ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... assessee because in that case the issue decided by the Supreme Court was as to whether the real owner can file a suit against his wife despite the coming into effect of the said Benami Transactions (Prohibition) Act. It was held by the Supreme Court that as the Act does not prohibit benami transaction involving purchase of property in the name of wife or unmarried daughter, filing of the suit against the wife or unmarried daughter is not prohibited under sections 4(1) and 4(2) of the said Act. Hence this case pertains only to a specific situation, namely when the banami property is being held in the name of wife and unmarried daughter. Hence the case law relied upon by the assessee cannot be applied to the instant case. As the latest Supreme Court decision in the case of Vrajlal J Ganatra has settled the issue that the said Benami Transactions (Prohibition) Act is prospective and the Tribunal's decision is also in accordance with it, no referable question of law arises from this issue, which has already been concluded by the aforesaid judgment of the Hon'ble Supreme Court. 4.3-2 On a close perusal of the facts of the case on record in the light of the case law relied upon by bot ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ect in holding that the assessee was given proper opportunity of being heard and in rejecting the assessee's claim to cross examine the persons whose statements were relied upon by the Assessing Officer against the assessee, the learned counsel for the assessee submitted that: Pages 95 to 96 of the paper book may be seen under the heading 'C Opportunity of a fair hearing denied'. This aspect of the matter has been discussed in paragraphs 72 onwards in the order of the Tribunal in the appeal, apart from page 4 of the Miscellaneous Application at paragraph 4 thereof. This was also discussed in the statement of facts furnished before the Tribunal in the Reference Application at pages 144 to 145 at paragraph II therein. Although the statements were recorded in 1984 itself, copies were furnished only in 1988, according to the assessee. Although the Assessing Officer proposed to deal with the contentions raised by the assessee at page 120 at paragraph 10.57 of the order of assessment, he did not deal with the stand of the assessee in this regard. While admitting the additional ground the Tribunal itself held that the appeal before the Tribunal was only in respect of extension of assessme ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... from such finding of the Tribunal in the aforesaid order. The assessment proceedings were started on 17-8-1984 by issue of notice under section 139(2). After issue of notice under section 142(1) and various adjournments, the return of income was filed on 31-12-1985. The case was posted for hearing 25 times as recorded in the assessment order on the very first page and notice under section 271 (1)(c) was also sent on 22-1-1987. The assessee was aware of the statements recorded from various parties as the Assessing Officer has made reference to them in January, 1987. The assessee asked for the copies of the statements recorded from third parties only on 21-1-1988 and copies were given on the same date and the assessee was allowed to go through the records on that date itself. Further the assessee never sought opportunity to cross examine the parties before the Assessing Officer or even before the Commissioner (Appeals). While so this plea has been taken for the first time before the Tribunal. The assessee has filed statements controverting the statements made by the third parties, but has never sought opportunity to cross examine before the lower authorities. After the assessee file ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ubmission on 8-3-1988. The matter was also posted for hearing on 9th to 11th and 14th March, 1988. At no point of proceedings before the Assessing officer or Commissioner (Appeals) did the assessee ask for cross examination or raise the issue of lack of opportunity. Under these circumstances the Tribunal came to a finding of fact that proper opportunity was given to the assessee. Thus when the matter was pending before the Assessing Officer from 19-1-1985 to March, 1988 and the assessee also filed clear explanation on 8-3-1988, if he wanted to file any further explanation or other material, nothing prevented the assessee from filing it. Hence the grievance of the assessee is not a genuine one. Under these circumstances the Tribunal has concluded that sufficient opportunity was given to the assessee and the assessee was not deprived of sufficient opportunity of being heard while the proceedings are pending before the Assessing Officer. In view of this clear finding of fact by the Tribunal, I am of the considered opinion that the questions sought to be referred in this regard are not referable questions of law. 6.1 Regarding the fifth, sixth, seventh and eighth questions relating t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... emonstrate that there is a mixed question of law and facts atleast. The Assessing Officer at para 10.69 of his order as well as the Tribunal in paragraph 11 of its order believed that the cash got on the sale of Kalmanda property was given in cash to Sundaram Pillai for purchase of shares held by his group in Century Flour Mills. But later events proved that no cash was paid by the assessee to Sundaram Pillai (vide order in WTA Nos. 272 to 275 (Mds)/1992 at pages 179 to 184 of the paper book at paragraphs 25 and 26 thereof) and the matter was remanded back to the Assessing Officer for ascertaining full facts. Although it is said in the Reference Application that the cash element is not relevant the Assessing Officer as well as the Tribunal went into the question of cash element and in page 13 there is reference to it. Further, the cash element is recognished by the Tribunal while directing the Assessing Office in the Miscellaneous Petition to allow all claims proved. But the point remains that payments were made by Mr. Ramesh and not by assessee. Reliance was also placed on paragraph 8 of the order of the Accountant Member at pages 196 to 198 of the paper book. 6.2 On the other h ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... spurious one. At pages 59 to 60 of the Tribunal's order the various statements furnished by Subramania Mudaliar, Dasappa, Venkataraman, Visasam and Arumaidurai were also considered for coming to the conclusion that the beneficiary of the total consideration is the assessee. The Tribunal has also taken into consideration at pages 67 to 69 the agreement dated 20-12-1980 which the assessee had entered into with Shri Amarlal Kishandas, which was a transaction at arms length. As the assessee did not honour the agreement with Amarlal Kishandas, the matter was taken by means of a Civil Miscellaneous Petition before the High Court and ultimately the assessee had to settle the matter with Amarlal Kishandas by not only returning his advance of Rs. 10 lakhs but also paying a further sum of Rs. 2 lakhs. By considering these facts the Tribunal has established that the agreement to sell the property to Shri Gopal at the rate of Rs. 2.10 lakhs per ground is totally unacceptable. The objections taken by the assessee in his written submissions would not stand in view of the order dated 10-11-1995 passed by the Tribunal in the Miscellaneous Petition. The Tribunal has come to a factual finding that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he said transaction. The Assessing Officer was directed to consider the assessee's claim for deduction of the expenditure based on the evidence to be produced by the assessee and decide the claim on merits while computing the capital gains. Ultimately the Tribunal has concluded that the assessee was the beneficiary of the total consideration of Rs.110 lakhs and directed the Assessing Officer to compute the capital gains tax accordingly. In the Miscellaneous Petition filed by the assessee the Tribunal directed the Assessing Officer to allow relief while computing capital gains in respect of any payment made to Amarlal Kishandas over and above the refund of Rs. 10 lakhs received as advance if the same is supported by proper evidence. Hence the said conclusion of the Tribunal is based on the material on record and the finding is only a finding of fact not giving rise to any referable question of law. 7.1 Now coming to the last question regarding section 52(2) of the Income-tax Act, as has been already indicated at the beginning of this order, both the learned Members have agreed that the finding of the Tribunal is that in the light of the evidence available on record as to the total ..... X X X X Extracts X X X X X X X X Extracts X X X X
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