1998 (2) TMI 2

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.... on the facts and circumstances of the case, the Tribunal was justified in law in upholding the assessment of the sum of Rs. 32,58,500 as the income of the assessee for the assessment year 1960-61?" A brief narration of the facts leading to the reference of the said question to the High Court may be necessary to appreciate the contention urged before us. On December 5, 1961, an order of regular assessment of the respondent-assessee was passed for the assessment year 1960-61 for which the relevant accounting year ended on May 31, 1959. Subsequently, it came to the notice of the Income-tax Officer that a sum of Rs. 32,58,500 had been received by the assessee purporting to be a loan advanced under agreement dated November 15, 1958, entered ....

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....ssee. The Accountant Member agreed with the reasoning and conclusion of the Income-tax Officer and the Appellate Assistant Commissioner that the loan was not a bona fide transaction; the Judicial Member took the view that many of the circumstances relied upon by the Revenue were neutral and the others raised suspicion against the assessee but concurred in the conclusion reached by the Accountant Member on the ground that the assessee had suffered the assessment under section 144 and there was paucity of material. The High Court took note of all the factors mentioned in the order of the Tribunal but opined that the apparent set of things disclosed that the said amount was a loan and that the burden of showing that the apparent was not rea....

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.... of fact recorded by the Tribunal. Here the Tribunal did not find any material to record a specific finding that the amount in question is in the nature of commission paid by Parsons and Whittemore to the assessee; it took note of the fact that the loan was advanced by agreement dated November 15, 1958, and that the Reserve Bank of India had accorded permission for obtaining the loan; it has also taken into consideration an earlier memorandum of understanding between the assessee and the representative of the foreign creditor, of July 19, 1957, recording that the proposal to grant loan would materialise along with implementation of other agreements to be entered into with the paper mills limited. The High Court in regard to the loan agre....