1988 (2) TMI 49

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..... sment stage ? " The assessee which is a partnership firm is carrying on business in the purchase and sale of piece goods, both in wholesale and retail, with its head office at Madurai. In the course of assessment proceedings for the assessment years 1963-64; 1964-65 and 1965-66, the Income-tax Officer found some credit entries in the books of the assessee in the names of Multani bankers at Madras. The assessee explained that such entries represented loans taken by the firm from those bankers for the purpose of the business. In support of the claim of the assessee, the discharged hundis and vouchers showing payment of interest were produced by the assessee. The Income-tax Officer observed that most of the bankers had accepted that they had .....

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..... vitiated as the Income-tax Officer had taken into account the statements made by the bankers without giving an opportunity to the assessee to cross-examine them. In that view, he directed deletion of the amounts in question. The view of the appellate authority was affirmed on further appeal by the Tribunal. The Department wanted a reference to this court on the question already set out and the Tribunal was directed to forward a statement of the case referring the said question. It is contended by learned counsel for the Revenue that the assessee had not discharged its initial burden of proving that there were loans incurred. It is argued that unless the assessee discharged its burden, it was not necessary for the Income-tax Officer to h .....

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..... f assessment, word for word, except for the preamble portion. The Tribunal has come to the conclusion that there is no evidence to show that the credit entries in the books of account of the assessee are false, The conclusion of the Tribunal is based on the facts and circumstances of the case. That conclusion cannot be said to be unreasonable or perverse. Really, a question of fact has been answered by the Tribunal on the basis of evidence available on record. In the result, we agree with the Tribunal that the appellate authority has rightly deleted the additions made by the Income-tax Officer. The question referred to us is answered in the affirmative and against the Revenue. The Revenue will pay the costs of the assessee. - .....

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