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TMI Blog1978 (1) TMI 45X X X X Extracts X X X X X X X X Extracts X X X X ..... of her marriage and out of the accumulation of interest thereon. The ITO found that the assessee was married in the year 1949. The ITO further found that she never maintained any books of accounts, that she did not have any trade licence for carrying on money-lending business and according to the ITO she could not produce rent receipts in respect of her business premises or for her residence at No. 63, Ratan Sarkar Garden Lane, Calcutta. Further, according to the ITO, the statements of profit and loss account and balance-sheet filed by the assessee did not have any evidentiary value and that she had filed voluntary returns for the assessment years 1956-57 to 1959-60, showing, according to the ITO, a false address in the returns and that the said returns were filed with the intention of creating evidence, according to the ITO again, to explain the investments of Rs. 57,500. The ITO further held that the voluntary returns filed for the assessment years 1956-57 to 1959-60, were filed on the 2nd July, 1960, all together and as such were filed subsequent to the dates on which the investments had been made by the assessee. It also came to the knowledge of the ITO that the assessee did no ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... therefore, deleted the addition of Rs. 57,500 made by the ITO. Being aggrieved by the aforesaid decision of the AAC, the revenue preferred an appeal before the Tribunal. The Tribunal considered in detail the history of the case and found that the voluntary returns for the assessment years 1956-57 to 1959-60 were filed by the assessee on the 2nd July, 1960, and the said assessments were completed on the 26th July, 1960, that is to say, after a few days of the filing of the returns. The incomes returned by the assessee in respect of the money-lending business were accepted by the ITO with small additions. With respect to the capital as at the beginning of the assessment year 1960-61, and regarding the source of investment of Rs. 57,500, the explanation of the assessee was that the original capital was Rs. 20,000 and the interest received between 1949 and 1955 was Rs. 14,779 and the amounts shown for the assessment years 1956-57 to 1959-60 were Rs. 29,555. Therfore, the total was Rs. 64,334. The assessee's case was that she had sufficient money to make the investments in question as was amply demonstrated by the assessment orders made on her for the assessment years 1956-57 to 1959- ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pon there was a direction by this court under s. 256(2) of the I.T. Act, 1961, and the Tribunal has referred the following question : " Whether, on the facts and in the circumstances of the case, and in view of the assessment orders previously made for the assessment years 1956-57 to 1959-60, the Tribunal was right in holding, that the investment of Rs. 57,500 was income of the assessee for the instant assessment year ? " In this case, the main question is whether Rs. 57,500 which was alleged to have been invested by the assessee in two firms was the assessee's income from undisclosed sources or the assessee's capital which had been explained. The main contention of the assessee was that the source of this money was the amount that she had explained in the previous assessment proceedings and the amount had been carried forward from the previous assessment years and was the opening balance in the relevant assessment year. The main question, therefore, is whether the assessee has furnished proper and satisfactory explanation with regard to the investment of Rs. 57,500 made by her in the year of account and in determining this question it is also necessary to consider whether the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... He has found that in view of the fact that the assessee had no trade licence and that she could not produce any evidence of residence or of business at Calcutta from where she was alleged to have carried her money-lending business and the fact that her husband had carried on the business at a place other than Calcutta, the assessee had not been able to prove that the assessee carried on any business, in fact, of money-lending. It cannot be said that such a conclusion of the ITO was based on no evidence or was perverse. Indeed, in the reference before us, there is no question of challenging the said finding of the ITO as either being perverse or based on no evidence. Secondly, the ITO has noted that the assessee had not been able to produce any books of account. There is some dispute as to whether the assessee's representatives had stated that the assessee maintained no books of account for the earlier years as well as for this year. Be that as it may, it is the common case that for the relevant assessment year, the assessee did not and could not produce any books of account and also said that the assessee did not maintain any books of account. There is some dispute as to whether t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ent assessment years. But such findings are not conclusive for this year. Reliance was also placed on the observations of the Supreme Court in the case of ITO v. S. K. Habibullah [1962] 44 ITR 809, 813, where the Supreme Court reiterated the views of the Judicial Committee referred to hereinbefore that once the assessment is made, it cannot be reopened except in circumstances detailed in ss. 34 and 35 of the Act and within the time prescribed. The same view was also expressed by the learned single judge of the Andhra Pradesh High Court in the case of Smt. Kantamani Venkata Satyavathi v. ITO [1967] 64 ITR 516. Our attention was also drawn to the decision of the Supreme Court in the case of Mahendra Mills Ltd. v. P. B. Desai, AAC [1975] 99 ITR 135, where the Supreme Court observed that the closing stock of the assessment year 1959-60 formed a part of the evidence relevant to the assessment for the assessment year 1960-61. There cannot be any dispute about that position but where an investment of a particular assessment year is being questioned then the source of that investment has to be independently examined and established. In view of the facts mentioned hereinbefore and what we h ..... X X X X Extracts X X X X X X X X Extracts X X X X
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