The applicant before us was assessed to tax by the Income-tax Officer of Mirzapur on a total income of Rs. 32,856. This included a sum of Rs. 17,051. He appealed and his appeal was dismissed by the Assistant Commissioner. He then applied for relief under Section 33 of the Act to the Commissioner, and he also prayed that the Commissioner should state a case and refer the same to us, formulating certain questions of law. The learned Commissioner of Income-tax, Central and United Provinces, refused both the requests of the assessee.
We have thus before us an application under Section 66(3) of the Act, and the question which we have got to decide is whether the Commissioners decision that no question of law arose in the case was correct or not. After having gone through the various orders of the Income-tax authorities and after having heard Mr. Malik, we have come to the conclusion that the question involved in this case is a pure question of fact and the Commissioners decision is correct.
The facts may now be stated. It appears that the assessee has been maintaining regular and correct books of account and even in the year in dispute his account books were accepted in the main, but the suspicion of the Income-tax officer was aroused by an entry of a receipt of Rs. 17,051 from a lady by the name of Mst. Ram Pyari. In response to a notice issued under Section 23(2) of the Act the assessee appeared and said that the lady was his aunt and that he had received the money as a gift from her. Some other questions were put to the assessee and he was asked if he could give any other proof for the statement that the money was received as a gift and he replied in the negative. He was then asked if he could show as to how much money this lady possessed and on this point also he expressed his inability. A pointed question was then put to him if this money did not represent any profits made by himself and the assessee gave a very evasive answer to the effect that the amount referred to old times and he could not produce any evidence regarding the same.
On this state of the evidence the Income-tax officer was of the opinion that this amount of Rs. 17,051 represented the profits of past years and as it was credited in the account of this year the matter should be taken into consideration when assessing the tax. On appeal the learned Assistant Commissioner on an examination of the account books of previous years came to the conclusion that regular sums of money were being received by the assessee from this very source and were suspiciously regarded by the predecessor of the present Income-tax Officer in former years, and the inference at which the Assistant Commissioner arrived was that there was a regular inflow of money year after year and therefore the assessee must have been carrying on a secret business which yielded income and profit. He refused to interfere with the order of the Income-tax Officer.
The position therefore is that the Income-tax Officer and the Assistant Commissioner have on the account books of the assessee himself and on the statements made by him, come to the conclusion that a particular sum entered in the books represented the profits of the assessee for the year in question and the two questions formulated by the assessee, therefore, do not arise out of the appellate order of the Assistant Commissioner and if they do arise, they are pure questions of fact and we cannot, under these circumstances, require the Commissioner to state and refer a case under Section 66(3) of the Act. The application is dismissed with costs. The learned counsel for the Department is entitled to a fee of Rs. 75.