TMI Blog1984 (2) TMI 37X X X X Extracts X X X X X X X X Extracts X X X X ..... summarised. The assessment year was 1967-68 and the relevant previous year ended on 31st March, 1967. The assessee had supplied goods to M/s. Hind Electric Stores, Chandni Chowk, Delhi, as per Bill No. 1458, dated 6th February, 1967. These goods were worth Rs. 16,551.09. According to the assessee, this amount was received in cash as follows: Rs. (1) On 23rd February, 1967 10,000.00 (2) On 14th March, 1967 3,000.00 (3) On 22nd March, 1967 3,551.09 However, the account books of M/s. Hind Electric Stores showed that the payment of the bill was made by cheque No. 11090 C.B. drawn on Central Bank of India on 27th July, 1967, and this cheque was encashed on that very day, i.e., 27th July, 1967. Thus, the discrepancy had to be expl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... records. But if, as is alleged by the assessee, it was not given an opportunity of cross-examining Sardari Lal, then the statement of Sardari Lal could not be acted upon by the Tribunal and if the finding of the Tribunal is based upon Sardari Lal's statement, it would be a finding which is not based upon any evidence. Similarly, if the assessee's contention that the endorsement by Shri Brij Mohan on the bill was undated is correct, then the finding of the Tribunal based upon the assumption that Shri Brij Mohan had acknowledged the receipt of the amounts on July 27, 1967, would be a finding which is not based upon any evidence. Whether the finding of the Tribunal is based upon any evidence is a question of law." This then is the basis on ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... onths later by a bearer cheque and this payment was made in July, 1967, when there was another bill of 27th July for Rs. 9,475.30, according to the assessee's account books. There is thus a difference between the assessee's books and those of M/s. Sona Electric Company. It was open to the ITO and the Department to accept one set of books as correct and not the other, but it seems unusual for the assessee to record payment in February and March for an amount of Rs. 16,551.09, when in fact that amount was paid in July. An entry in the books in favour of creditor is an acknowledgment of payment which would not readily be made by an unpaid creditor. . However, we are not to see the correctness or otherwise of the decision by the income-tax a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t was made in cash. The only difference between the parties is regarding the date of the payment. We agree that the absence of a date on the writing makes all the difference. The Tribunal noted as follows: " There is absolutely no explanation whatsoever as to why Brij Mohan should have signed the bill in token of the payment, if the payments were already received by the assessee five months earlier. " This shows that the Tribunal was under the impression that the signature and acknowledgment were written five months after the payment. This fact is certainly not borne out by the writing and shows that the Tribunal has acted without evidence. Then, there is, finally, the third question which requires to be examined. The statement of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ally possible to take the view that the entry of M/s. Hind Electric Stores is wrong because they could have made the payment for February and March from undisclosed sources and then issued a cheque in the name of the assessee and encashed it themselves to make a later entry. However, a decision either way would be based on conjectures and surmises and this would not be proper. Learned counsel for the Department urged that this was a case to which s. 68 of the I.T. Act, 1961, applied, and a presumption should be drawn against the assessee for not proving the correctness of the entry in the books of account. We think that the section makes it clear that the entry can be rejected if the explanation offered by the assessee can be rejected by ..... X X X X Extracts X X X X X X X X Extracts X X X X
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