Cash credit entries as undisclosed income upheld where the Tribunal's factual finding was supported by relevant material.

Cash credit entries standing in the names of two ladies linked to an assessee's former driver-turned-transport contractor were treated as income from undisclosed sources after the explanation that the deposits represented sale proceeds of ornaments was rejected. The Tribunal upheld the addition, and the High Court found that the dispute was essentially factual. As the material relied upon was relevant to the enquiry, the finding could not be said to be unsupported by evidence. The conclusion that the cash credits represented income from undisclosed sources was therefore upheld in favour of the Revenue.

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Issues: Whether there was material to support the finding that the cash credit entries represented the assessee's income from undisclosed sources.

Analysis: The entries in question stood in the names of two ladies connected with an erstwhile driver who had become a transport contractor of the assessee. The explanation that the deposits came from sale proceeds of ornaments was rejected by the Income-tax Officer and the Tribunal upheld the addition. On the recorded facts, the issue was one of fact, and the material relied upon by the Tribunal was relevant to the enquiry. It could not therefore be said that the finding was unsupported by material.

Conclusion: The finding that the cash credit entries represented income from undisclosed sources was supported by material and is upheld in favour of the Revenue.

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