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Hanuman Ram Audan Ram Vs. Commissioner of Income-tax - Court Judgment

LegalCrystal Citation
SubjectDirect Taxation
CourtAllahabad High Court
Decided On
Case NumberIncome-tax Reference No. 231 of 1972
Judge
Reported in[1977]110ITR712(All)
ActsIncome Tax Act, 1961 - Sections 256
AppellantHanuman Ram Audan Ram
RespondentCommissioner of Income-tax
Appellant AdvocateA.N. Mahajan and ;N.N. Pachauri, Advs.
Respondent AdvocateDeokinandan and ;Ashok Gupta, Advs.
Excerpt:
.....non-consideration of that evidence ? 2. whether, in the circumstances of the case, the evidence of dayashanker and sundera devi, if recorded by the appellate assistant commissioner, could be ignored from consideration on the ground that theincome-tax officer had not been given an opportunity to rebut thatevidence ?' 2. shri mahajan, the learned counsel for the assessee, contended 3. on the other hand, the learned standing counsel for the income-tax department submitted that the statements alleged to have been made by daya shanker and sundera devi before the appellate assistant commissioner were not available in the record of the appeal before him, that it was not established that those two persons had been examined by him and that at any rate the tribunal had considered their statements..........non-consideration of that evidence 2. whether, in the circumstances of the case, the evidence of dayashanker and sundera devi, if recorded by the appellate assistant commissioner, could be ignored from consideration on the ground that theincome-tax officer had not been given an opportunity to rebut thatevidence ?' 2. shri mahajan, the learned counsel for the assessee, contended that thetribunal in coming to the conclusion that the assessee had failed to provethe source of the cash credits standing in the names of daya shanker andsundera devi had not considered their evidence before the appellate assistant commissioner and that hence the order of the tribunal was vitiated by non-consideration of such evidence. 3. on the other hand, the learned standing counsel for the income-tax.....
Judgment:

D.M. Chandrashekhar, J.

1. At the instance of the assessee, the Income-tax Appellate Tribunal, Allahabad Bench (shortly called 'the Tribunal'), has referred to this court under Section 256 of the Income-tax Act, 1961 (shortly called ' the Act'), the following questions of law :

'1. Whether, in coming to the conclusion that the assessee has failed to prove the source of cash credits standing in the name of Daya Shanker and Sundera Devi, the Tribunal has considered the evidence of Daya Shanker and Sundera Devi recorded by the Appellate Assistant Commissioner, if not, whether the appellate order is vitiated because of non-consideration of that evidence

2. Whether, in the circumstances of the case, the evidence of DayaShanker and Sundera Devi, if recorded by the Appellate Assistant Commissioner, could be ignored from consideration on the ground that theIncome-tax Officer had not been given an opportunity to rebut thatevidence ?'

2. Shri Mahajan, the learned counsel for the assessee, contended that theTribunal in coming to the conclusion that the assessee had failed to provethe source of the cash credits standing in the names of Daya Shanker andSundera Devi had not considered their evidence before the Appellate Assistant Commissioner and that hence the order of the Tribunal was vitiated by non-consideration of such evidence.

3. On the other hand, the learned standing counsel for the income-tax department submitted that the statements alleged to have been made by Daya Shanker and Sundera Devi before the Appellate Assistant Commissioner were not available in the record of the appeal before him, that it was not established that those two persons had been examined by him and that at any rate the Tribunal had considered their statements before reaching the conclusion that the assessee had failed to prove the sources of cash credit standing in their names.

4. In para. 6 of the statement of the case the Tribunal has said :

'On these facts, we are of opinion that statements of Shri Daya Shanker and Smt. Sundera Devi were recorded by the Appellate Assistant Commissioner, but they were not made available by the department to the Appellate Tribunal in the course of the hearing of the appeal.', On behalf of the revenue, an application has been made in this case praying that the above passage should be deleted from the statement of the case by the Tribunal since the same constituted a fresh finding by the Tribunal. It is alleged in that application that when the Tribunal heard and decided the appeal it did not say in its order that the statements of Daya Shanker and Sundera Devi were recorded by the Appellate Assistant Commissioner. In para. 3 of its appellate order the Tribunal has said : 'With regard to Sundera Devi the Appellate Assistant Commissioner clearly states that she appeared before him but the Appellate Assistant Commissioner has not given the statement as made by Sundera Devi or the statement made by Daya Shanker assuming that Daya Shanker also appeared before the Appellate Assistant Commissioner......'

5. From the aforesaid passage it is clear that the Tribunal proceeded on thebasis that Sundera Devi had appeared before the Appellate Assistant Commissioner and given her statement. In its appellate order the Tribunal hasnot said positively that Daya Shanker did not appear before the AppellateAssistant Commissioner and make any statement. On the other hand, theTribunal proceeded on the basis that Daya Shanker had also made the statement before the Appellate Assistant Commissioner. Hence, it is too late inthe day for the revenue to contend that the Tribunal's statement of the casecontains a new finding that the Appellate Assistant Commissioner recordedthe statements of Daya Shanker and Sundera Devi. However, it is notnecessary for us to go into the question whether the statements of SunderaDevi and Daya Shanker were recorded by the Appellate Assistant Commissioner separately or were merely incorporated in his order. Whether thestatements of those two persons were separately recorded or were merelyincorporated in the order of the Appellate Assistant Commissioner, it doesnot admit of any doubt that the Tribunal should have considered in its appellate order the statements of these two persons.

6. In para. 3 of its appellate order the Tribunal has observed :

'It appears also that the Appellate Assistant Commissioner had before him the statement made before the Income-tax Officer by Daya Shanker and Sundera Devi and one is at a loss to know why the Appellate Assistant Commissioner examined these two persons again when the matter was under appeal before him and that too without giving any opportunity to the Income-tax Officer to rebut the statements as made by the said two parties.'

7. The above passage seems to indicate that the Tribunal did not regard the statements made by Daya Shanker and Sundera Devi before the Appellate Assistant Commissioner as being of any value or importance. The reason given by the Tribunal for so doing can best be stated in its own words:

'The Appellate Assistant Commissioner has not pointed out anywherethe source from which these two persons came into possession of the respective amounts and has not examined the fact that no interest was chargedby either of the parties for the alleged loan......'

8. In his statement before the Appellate Assistant Commissioner, Daya Shanker had clearly stated that he had deposited a sum of Rs. 4,000 with the assessee as he was contemplating the marriage of his daughter and that the marriage took place in May, 1963. This part of the statement of Daya Shanker has been completely lost sight of by the Tribunal.

9. The Appellate Assistant Commissioner has stated in para. 4 of his order that Sundera Devi was a widow and was living with her father, that she loaned Rs. 3,000 and that she subsequently withdrew this amount from the assessee. This part of her statement has also not been considered by the Tribunal.

10. The Tribunal appears to have considered the statements made by Daya Shanker and Sundera Devi before the Income-tax Officer but not the statements made by them before the Appellate Assistant Commissioner.

11. Thus, it is clear that the Tribunal has not considered the statements of Daya Shanker and Sundera Devi recorded by the Appellate Assistant Commissioner. As such statements constituted material evidence in favour of the assessee, the appellate order of the Tribunal is, in our opinion, vitiated by non-consideration of material evidence.

12. In the view we take on the first question, we do not consider it necessary to answer the second question referred to us.

13. As a result of the foregoing discussion we answer the first question infavour of the assessee and as follows :

'In coming to the conclusion that the assessee had failed to prove the sources of cash credits standing in the names of Daya Shanker and SunderaDevi, the Tribunal did not consider the evidence of Daya Shanker andSundera Devi recorded before the Appellate Assistant Commissioner and, hence, the order of the Tribunal is vitiated on account of non-consideration of such evidence.'

14. In the circumstances of the case we make no order as to costs.


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