1983 (1) TMI 21

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..... ee-company for the previous year relevant to the assessment year 1959-60 there were cash credits totalling Rs. 3,36,000. This amount was added as income of the assessee in the said assessment year. In appeal, the AAC found that cash credits amounting to Rs. 2,50,000, out of the total cash credits of Rs. 3,36,000, fell within that part of the financial year which was relevant to the assessment year .....

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..... 1958-59. The AAC, therefore, cancelled the assessment made by the ITO. This view of the AAC was confirmed by the Tribunal. Arising out of this order of the Tribunal, the following question has been referred under s. 256(1) of the I.T. Act, 1961 : " When the completed assessment for 1958-59 is reopened by notice issued by the Income-tax Officer under section 148 of the Income-tax Act, 1961, would .....

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..... behalf of the Revenue, has invited our attention to the decision of the Supreme Court in Govinddas v. ITO [1976] 103 ITR 123, in which, construing the provisions of s. 297(2)(d)(ii), the Supreme Court has held that the words " all the provisions of this Act shall apply accordingly " in that provision merely refer to the machinery provided in the new Act for the assessment of escaped income and th .....

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..... ssessee offers no explanation about the nature and source thereof, or the explanation offered by him is not in the opinion of the ITO satisfactory, the sum so credited may be charged to income-tax as the income of the assessee of that previous year. That is why the AAC and the Tribunal have taken the view that the addition should have been made in the previous year, relevant to the assessment year .....

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..... vinddas cited supra. Accordingly, the question has to be answered by holding that the unexplained cash credits will be governed not by s. 68 of the I.T. Act, 1961, but by the law as it was under the Indian I.T. Act, 1922. The question is accordingly answered as above. As there is no appearance on behalf of the assessee, there will be no order as to costs of this reference.
Case laws, Decisions .....

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