Unclear revisional direction on source of funds led to remand for fresh assessment and evidence from assessees.

A revisional order under section 34 of the Tamil Nadu Agricultural Income-tax Act, 1955 was found unclear because it did not expressly set aside the assessments or specify how the assessing officer should proceed. The direction to verify the source of purchase and modify the assessments accordingly was too imprecise to be acted upon. The revisional and assessment orders were therefore set aside and the matters remanded for fresh consideration, with the assessees to be given an opportunity to produce evidence on the source of funds; if they failed to do so, adverse inference could be drawn under section 114(g) of the Indian Evidence Act.

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Issues: Whether the revisional order under section 34 of the Tamil Nadu Agricultural Income-tax Act, 1955 was clear and workable, and whether the assessments should be set aside and remanded for fresh consideration.

Analysis: The revisional authority recorded findings on the source of purchase of the lands, but the operative direction did not clearly state that the original assessments were set aside or specify the manner in which the assessing officer was to proceed. The direction to verify the source of purchase and modify the assessments accordingly was held to be insufficiently precise to be acted upon. As no adequate materials had been placed to explain the source of funds, the matter required a fresh look by the assessing officer after giving the assessees an opportunity to produce relevant evidence.

Conclusion: The revisional and assessment orders were set aside and the matters were remanded to the assessing officer for fresh consideration; if the assessees failed to explain the source of funds, adverse inference could be drawn under section 114(g) of the Indian Evidence Act.

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