1948 (8) TMI 29

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..... f ₹ 5,000 on 2nd April, 1941. The two cash credits were discovered in the personal account designated as the "cash chest account." The Income Tax Officer assessed the aggregate sum of ₹ 15,000 as part of the total income of the assessee earned during the accounting year. On appeal before the Appellate Assistant Commissioner, it was argued on behalf of the assessee that the "cash chest account" had been in existence since 1931, the previous credits had gone to make up the opening balance of ₹ 35,000 disclosed in the account, and that this account and the respective entries therein were noticed by the Income Tax Officer on previous occasions, when they were not questioned. The Appellate Assistant Commissi .....

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..... eceipts are of an income nature would be on the Income Tax Officer if the Income Tax Officer failed to notice similar unexplained cash receipts in the accounts of earlier years in the course of the assessment proceedings of those years." This application was dismissed by the Tribunal as they were not satisfied with the explanation sought to be given on behalf of the applicant with regard to the cash credits of ₹ 15,000 in the relevant accounting year, and they were of the opinion that the said sum was rightly treated as the income of the appellant by the Income Tax authorities. On an application made to this Court under Section 66 (2) of the Act, if was brought to notice that the assessee was given to understand that the questio .....

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..... ure. There cannot be the slightest conceivable doubt that when both the source and the nature of the cash receipts shown in the accounting year have not been proved, the Income Tax Officer cannot draw any other inference except that those two amounts are income receipts. If it were held that he should, there result would be that every assessee will be entitled to enter cash credits in his account and refuse to furnish the requisite particulars about its source and nature and insist that those entities should be automatically treated as capital receipts and not as income receipts. The answer to the first question has therefore necessarily to be in the affirmative. It is significant with regard to the second question that it starts with refe .....

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