1992 (2) TMI 68

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....einafter referred to as "the assessee"), the following question has been referred under section 256(1) of the Income-tax Act, 1961 (in short, "the Act"), by the Income-tax Appellate Tribunal, Cuttack Bench, Cuttack (in short, "the Tribunal") : "Whether, in the facts and circumstances of the case, further addition to Rs. 35,753 as unexplained investment is justified when estimate is reported to ....

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....ncome-tax Officer worked out the peak shortage of cash at Rs. 35,735. The assessee challenged the additions in appeal before the Commissioner of Income-tax (Appeals). The additions on the aforesaid accounts were assailed before the said authority. On going through the accounts, the Commissioner of Income-tax (Appeals) was satisfied that the peak shortage of cash as worked out by the Incometax Offi....

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....s it related to cash introduced through unpaid wages account. So far as the assessee's appeal is concerned, the Tribunal held that there was no cogent explanation offered for the shortage and, therefore, the authorities were justified in making the addition. The assessee filed an application under section 256(1) making a motion for reference of four questions to this court. But the Tribunal only r....

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....ring the relevant assessment year. It is a matter of consideration by the taxing authority as to whether the unexplained expenditure or investment could be reasonably attributed to a pre-existing fund of concealed income. The true nature of the deficit and the pre-existing fund, if any, have to be ascertained. A number of circumstances of vital significance which are almost difficult to enumerate ....