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TMI Blog1973 (9) TMI 12X X X X Extracts X X X X X X X X Extracts X X X X ..... n any earlier assessment year is not based upon any evidence at all and is based on merely surmise and conjecture. We, therefore, hold that the amount of Rs. 21,107 is not includible in the assessee-company's income of this year under section 10(2A) of the Act. The question referred to us is answered in the negative, i.e., in favour of the assessee and against the department. X X X X Extracts X X X X X X X X Extracts X X X X ..... the assessment year 1956-57, the Income-tax Officer sought to include this amount in the assessee's income for this year. The assessee, however, contended that in the assessment year 1943-44, it had not debited the higher price actually charged and recovered by the Government and the amount had not been allowed by the department as an expenditure in that year. The Income-tax Officer did not accept this contention and included this amount in the income of the assessee-company for the assessment year 1956-57. The assessee preferred an appeal before the Appellate Assistant Commissioner and in this appeal, the Appellate Assistant Commissioner held that as the receipt of Rs. 21,107 represented only reimbursement of expenses which at no earlier ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s income under section 10(2A) of the Act, there is no dispute that, as a matter of fact, the said amount was being treated as the assessee's income under section 10(2A) of the Act. This is made clear by the order of the Tribunal wherein it is stated that " the department proposes to tax this amount as refund of expenditure under section 10(2A). " It is not the department's case that this amount represented the profits of the assessee-company arising from its business during the assessment year under reference. Admittedly, this amount represents the extra price paid by the assessee-company to the Government over and above the price which it had to pay under the contract. It was this extra price that was refunded to the assessee-company durin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (xv) of sub-section (2) of section 10 of the Act, in which case the burden would have fallen upon the assessee to prove the facts which entitled him to claim the exemption or to claim the allowance or deduction as an expenditure. This is a case where the amount in question represents the refund of the amount actually paid by the assessee to the Government. It is only if an allowance or deduction had been given for this amount in the earlier assessment years that it can be included as the assessee's income of this year under section 10(2A) of the Act. The burden, therefore, lies upon the department to prove that an allowance or deduction had been given for this amount to the assessee-company in the earlier assessment years. The Tribunal has ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s conclusion on what it calls the probabilities of the case. According to the Tribunal, it would be very improbable to expect that the assessee-company would not debit such expenses, though actually incurred, simply because there may be a possibility of getting refund for the same. Again, according to the Tribunal, such an action would not only inflate the profits and increase the tax liability, but would deprive the assessee of his money for a long period. We are unable to agree with this reasoning of the Tribunal. The assessee had disputed its liability to pay the extra price to the Government and obviously it paid it under protest and it had also been pressing for the refund of the said amount. Under these circumstances, it cannot be sai ..... X X X X Extracts X X X X X X X X Extracts X X X X
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