1993 (7) TMI 20

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....s are referred to this court under section 256(1) of the Income-tax Act, 1961, at the instance of the assessee : "(1) Whether, on the facts and in the circumstances of the case, the Tribunal erred in holding that the assessee is not entitled to the deduction of the sum of Rs. 4,10,648 being the sum claimed by the assessee as the amount embezzled by its former managing director, the late Shri P.....

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....n dated April 1, 1966. The appointment was continued from time to time. He died in harness on June 14, 1971. After his death, his wife, Mrs. F. P. Mehta, was appointed as the managing director. There was a raid by the income-tax authorities on the premises of the assessee on December 18, 1971. The account books were seized. The managing director applied in January, 1972, to the Commissioner of Inc....

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....ing director, Shri P. N. Mehta. This amount comprised of Rs. 2,28,725 as commission wrongly debited to the assessee's account which was offered for settlement, and Rs. 1,19,345 withdrawn by him. The Income-tax Officer disallowed the claim of Rs. 2,28,725 on the ground that it was a duplicate claim. Claim of Rs. 1,19,345 was also disallowed on the grounds : (i) that embezzlement was not proved, and....

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....s appointment is subject to the general control and supervision of the board. The assessee has also not proved the terms of the agreement appointing Shri Khokhani as their commission agent. Shri Khokhani has not supported the case of the assessee. The petition for settlement filed before the Commissioner of Income-tax clearly indicates that the major shareholding of the assessee was by Shri Mehta ....