TMI Blog1980 (8) TMI 8X X X X Extracts X X X X X X X X Extracts X X X X ..... December 5, 1961, which resulted in a loss of Rs. 12,599 being computed. Subsequently proceedings were started under s. 147(a) of the I.T. Act, 1961, on the ground that a sum of Rs. 32,58,500 had been received by the assessee purporting to be a loan from M/s. Parsons Whittemore Commerce Ltd. of Canada, but really it was not a loan but some commission paid to the assessee and, therefore, must be treated as business income. The assessee resisted the claim, but the ITO took note of certain circumstances and came to the conclusion that the amount should be treated as income received from business and concluded the assessment. The reasons given by him to reach that conclusion were (i) No correspondence had been produced before him to show that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... terminated and observed that the circumstances would lead to the conclusion that the amount was never expected to be repaid. He thus confirmed the conclusion reached by the ITO. The assessee preferred a second appeal to the Tribunal which dismissed the appeal. The judicial Member of the Tribunal wrote a separate order, but agreed with the conclusion of the Accountant Member that the appeal should be dismissed. He considered several circumstances noticed by the ITO as well as by the AAC. In regard to most of the circumstances, he was of the opinion that they were neutral and in regard to a few of the circumstances that they may throw suspicion against the assessee. He agreed for the dismissal of the appeal observing that the assessee had ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... emore Commerce Ltd. to the assessee. There is no specific documentary evidence in support of such finding. The broad facts considered by all the authorities are these: (i) The amount of Rs. 32,58,500 was advanced by way of loan and was evidenced by an agreement dated November 15, 1958. The Reserve Bank of India had accorded permission for obtaining the loan. (ii) Earlier to this there was also a letter under the signature of Anupsing Bedi as well as the representative of the foreign collaborator dated July 10, 1957, which records the seeking of a loan proposal and to grant it and further mentions that such a loan would be granted simultaneously or along with the implementation of other agreements to be entered into with Mandya Nati ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or cumulatively lead to justify any conclusion that the amount was not indeed a loan as is purported to be but was anything in the nature of commission or any receipt from business. The letter of the foreign collaborator which had been written to the ITO in reply to his query was categorical and in fact confirmed the assertion that was all along being made by the assessee that the transaction was one of loan and there was no suspicion about it. It appears to us that it is on account of inadequacy of the material that the Tribunal had refrained from recording any specific finding that there was any commission received by the assessee. The apparent state of things was that the amount was a loan. The burden of showing that the apparent state ..... X X X X Extracts X X X X X X X X Extracts X X X X
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