TMI Blog2008 (1) TMI 567X X X X Extracts X X X X X X X X Extracts X X X X ..... nd not merely with reference to entries made in the books of account. The finding of fact was to the effect that the assessee did not earn the income and the conclusion of Tribunal was right. (ii) since the assessee claimed that the premium was paid by it the liability to pay tax could not be fastened upon on the assessee. - 18 of 2004 - - - Dated:- 17-1-2008 - N. P. GUPTA and DEO NARAYAN THANVI JJ. K K. Bissa for the appellant. Anjay Kothari for the respondent . JUDGMENT 1. This appeal has been filed by the Revenue against the judgment of the Tribunal dated November 19, 2003, annexure 3, deciding two appeals for the same assessment year 1998-99. Appeal No. 138 having been filed by the assessee and Appeal No. 161 hav ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... payment of salary to spouse in the hands of directors in the light of the provisions of section 64 of the Income-tax Act?" 3. Arguing the appeal, the learned counsel for the Revenue read to us all the impugned judgments including the judgment of the assessing authority as well as the appellate authority. 4. We have heard the learned counsel and have gone through the judgments cited at the Bar and the relevant provisions of law as well, and have also gone through the record. 5. So far as the first question is concerned, of course, it has come that the assessee was maintaining books of account by both manners, viz., by receipt basis, and on mercantile basis as well, inasmuch as, with respect to accrual of lease income, mercantile ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s following the mercantile system. Then the realities of life were considered, about there being defaults in payment, and disputes, and sometimes the hirer refused to make payment. Then various judgments had been considered, and it was again considered, that the real income is to be considered with reference to commercial and business realities of the situation, and not merely with reference to entries made in the books of account. Then the judgment of the hon'ble Supreme Court in Andhra Bank Ltd. v. CIT reported in [1997] 225 ITR 447 was followed, wherein it was held that there cannot be a tax if no income resulted, despite the entry in the book keeping. Therefore, it was found that to arrive at a real income in the case in hand, the accru ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o pay tax, on the above principles, considered while deciding question No. 1, cannot be fastened on the assessee. 8. This question is, accordingly, answered against the Revenue. 9. Then coming to questions Nos. 3 and 4, on this aspect, the matter has already been remanded by the Commissioner of Income-tax (Appeals) to the assessing authority, which order had been affirmed. It is not in dispute that the question is required to be examined on the anvil of the provisions of section 64, and for that purpose, the matter has already been remanded. Therefore, we need not go into the question as framed by this court. The questions are, accordingly, not required to be answered, and are not answered. 10. The net result of the aforesaid d ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
