1. On a reference application, the Tribunal has referred the following questions set out at page 5 of the statement of case for our opinion :
'1. Whether, on the facts and in the circumstances of the case, the Tribunal was justified in law in holding that the onus is on the Revenue to establish that the assessee was the owner of the valuables and books of account found and seized from the business-cum-residential premises of the assessee ?
2. Whether, on the facts and in the circumstances of the case, the Tribunal was justified in law in deleting the sum of Rs. 12,395 from the total income of the assessee for the assessment year 1974-75 and the sum of Rs. 94,447 from the total income of the assessee for the assessment year 1975-76 ?'
There was a search at the residence of the assessee and books including gold jewellery were seized. When on the seized material some additions were made in the hands of the assessee, for the assessment years 1974-75 and 1975-76 on an application under Section 264, the Commissioner of Income-tax has directed the Assessing Officer to re-examine the seized material. The notice under Section 143(2) was served on the assessee, Nikunja Behari Das, the legal representative of the assessee. Again, the cash book, ledger, gold jewellery register and also seized excise books were examined. The Income-tax Officer has also examined the regular books of account, showing the transaction in gold and jewellery and noticed the Inspector's report on perusal of the book No. 1, book No. 2 and book No. 3 for the B. S. 1380, B. S. 1381 and B. S. 1381. These transactions were not entered in the regular sets of accounts, nor the particulars of these transactions were disclosed. Therefore, in the second round also income was estimated at the rate of 15 per cent. on such transactions and added as income from undisclosed sources.
2. In appeal before the Commissioner of Income-tax (Appeals), the Commissioner of Income-tax (Appeals) found that the seized books which are seized by the Gold Control authorities belonged to the legal representative of the assessee, i. e., Nikunja Behari Das, and the books and jewellery in the possession of the legal representative of the assessee was treated as belonging to the assessee and the income was estimated on the basis of the transactions found on the material seized and the investment made in the jewellery. The Commissioner of Income-tax (Appeals) has finally dismissed the appeal.
3. In the second appeal before the Tribunal, the Tribunal has noticed these facts and in the end has taken the view that any additions in both the years are not maintainable.
4. None, appeared for the assessee, though the matter was listed several times. Heard learned counsel for the Revenue. The undisputed facts are that there was a search by the Gold Control authorities at the residence of Sarat Chandra Das, the assessee, who was bed-ridden, and Nikunja Behari Das, son of the assessee, in fact was carrying on the business on a licence which was in the name of the assessee. The books of account and jewellery were seized from the room of Nikunja Behari Das. The Gold Control authorities has also imposed the penalty on Nikunja Behari Das for misusing the licence, which stood in the name of his father. That further supports the case of the assessee that the business was carried on by Nikunja Behari Das son of the assessee and not by the assessee. When Nikunja Behari Das was using the licence of his father, it does not mean that whatever the income earned by Nikunja Behari Das belonged to his father, only on the ground that the licence was in the name of his father.
5. For the purpose of income-tax, the income belonged to a person who earns it and not to the person in whose name the business is carried on. When there is a finding that during the relevant period corresponding to the assessment years, the assessee, Sri Sarat Chandra Das, father of Nikunja Behari Das, was bedridden and his son, i.e., Sri Nikunja Behari Das, was in absolute control of the business and was actually carrying on the business--that was the finding, how the income earned out of that business can be treated as income of Sarat Chandra Das.
6. Even the Gold Control authorities have also taken the view that the business was carried on by Nikunja Behari Das by using the licence of his father. It is also noticed that during the search, 20 grams of primary gold and gold ornaments were found from the iron safe placed in the bed room of Sri Nikunja Behari Das.
7. A query was put to Nikunja Behari Das by the Gold Control authorities that whether that gold and gold ornaments were kept for the purpose of trade. He did not explain how he came into possession of that gold and gold ornaments. The Tribunal has at page 36 observed that Nikunja Behari Das should be treated as the owner of the articles and unrecorded transactions and not the deceased assessee. On that basis, the Tribunal stated that the addition is not maintainable.
8. This finding of the Tribunal that Nikunja Behari Das is the owner of gold and gold ornaments and carrying on the business is a finding of fact. Therefore, the finding of fact unless it is perverse cannot be interfered with.
9. Accordingly, we answer both the questions in the affirmative, i.e., infavour of the assessee and against the Revenue. The application is accordingly disposed of.
10. All parties are to act on the operative portion of this judgment on theusual undertaking.