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TMI Blog1953 (6) TMI 9X X X X Extracts X X X X X X X X Extracts X X X X ..... t earned in the account year was found by the Income-tax Appellate authority to be ₹ 18,766, Upon these facts the assessee asked the Appellate Tribunal to state the following five questions of law:- (i)Whether in the circumstances of the case there is any material for the finding that instead of direct remittance the assessee has chosen to instruct a debtor in Jubbal State to discharge a part his debt by making the payment of ₹ 32,000 in British India. (ii)Whether in the circumstances of the case there ₹ 32,000 has been correctly held to be a construct remittance from Jubbal State to British India. (iii)Whether in the circumstances of the case it has been correctly held that the assessee remitted the entire profits of the account year 1942-43 in the sum of ₹ 32,000. (iv)Is there any evidence to support the finding of the Appellate Tribunal that the sale proceeds of ₹ 32,000 received in British India include entire profits earned or accrued in Jubbal State in the account year 1942-43. (v)Whether there is any material on the record to justify a conclusion that the sum of ₹ 32,000 received in British India was 'income' and therefo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e Appellate Tribunal or here and therefore we have not allowed this question to be raised. The other question which has been sought to be raised is that although ₹ 32,000 was received in British India only the proportionate profit which should be deemed to have accrued from this sum could be computed for the purposes of profit and loss account. This question again does not, in my opinion, arise from the questions which are in paragraph 6 or paragraph 9 of the petition. The purport of the questions which were asked to be stated is really confined to the question whether the sum of ₹ 32,000 included the entire profits which were made by the assessee in the account period in this account, The question reduces itself to this: whether the ₹ 32,000 which was received in British India should be presumed to include the profits; that is, the sum of ₹ 18,766. The learned Advocate-General submits that this question is covered by an authority of this Court in Commissioner of Income-tax, East Punjab and Delhi Provinces v. Messrs. Jankidas Kaluram Rewar [1949] 1 7 ITR 40 6, where it was held that where remittances have been received by an assessee in British India from ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... his account books and led no other evidence to show that the amount received by him did not represent the profit. The Court held that the assessing authority having made a presumption which was one of fact no redress could be given to the assessee on the ground that it could not be said that such a presumption could not be raised by the assessing authorities. In In re Murugappa Chettiar [1926] ILR 46 Mad. 465, money was remitted to the headquarters of a firm in British India from a branch situate in a foreign country. This was presumed to be profits and not capital and thus assessable to income-tax unless the assessee could prove the contrary. The learned Judges said at page 467 :- " The presumption that the Commissioner made in this case, viz., that prima facie all remittances were to be regarded as profits and that the burden of proof was cast upon the assessee to show the contrary, seems to be amply warranted by the authority of that case (Scottish Provident Institution v. John Allen [1930] AC 129). As the Commissioner did not misdirect himself the only questions in the case that remain are purely questions of fact and so long as he has approached them without any misc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... were remitted." The Lahore High Court in Tara Chand Pohu Mai v. Commissioner of Income-tax, Punjab [1936] 4 ITR 312 , following the two Madras cases, also held that the ordinary presumption is that the money remitted to the headquarters of a firm in British India from a branch situate in a foreign country is presumed to be profit and not capital unless the assessee proves to the contrary. On a review of all these cases Achhru Ram, J., in Jankidas Kaluram's case (supra), said:- "In the absence of any indication to the contrary and in the absence of any explanation by the assessee, the Income-tax authorities may well start with the presumption that the remittances either represent the profit earned by the assessee or at least include the profit earned by him and may be within their limits in assessing him on the remittances to the extent to which they can legitimately be regarded as representing the profit. However, this is by no means a presumption of law and its strength must vary according to the circumstances of each case. There may even be circumstances in which it may legitimately be said that even initially no such presumption should be raised. In every case ..... X X X X Extracts X X X X X X X X Extracts X X X X
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