1994 (1) TMI 21

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....1 (hereinafter referred to as "the Act"), at the instance of the Revenue, the following two questions of law have been referred to this court for its opinion : "(1) Whether, on the facts and in the circumstances of the case, the Appellate Tribunal was right in deleting the addition of Rs. 30,972 assessed as income under section 69D of the Income-tax Act, 1961, for the assessment year 1978-79 ? ....

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....ome and brought to tax. On appeal by the assessee, the view taken by the Income-tax Officer was affirmed. On further appeal by the assessee, the Tribunal held that the assessee had a running account with the two creditors and the borrowals were not made on hundis, but were only in the nature of collateral security for the borrowals. In addition, the Tribunal also took the view that the word "hundi....

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....the answer to the first question referred. The contents of the documents executed by the assessee, though written on hundi papers, show that the essential characteristic of a hundi, viz., an unconditional order signed by the maker directing a certain person to pay a certain sum of money only to or to the order of a certain person or to the bearer of the instrument, is absent. The only circumstance....

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....lf, may not be decisive. It would, therefore, be unnecessary for us to consider the question of the applicability of section 69D of the Act to hundis couched in English. We, therefore, answer the second question referred in the affirmative and against the Revenue. Regarding the first question, in view of the answer returned on the second question that the documents are not hundis, there is no q....