1979 (11) TMI 69

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...., Ernakulam. The assessee by herself has no business, profession or vocation, which earns her any income nor has she any heads of income such as what is mentioned in s. 14 of the I.T. Act, except a small property income. She was not at any time an income-tax assessee. On notices issued by the ITO, returns were filed for the two years in question. On November 15, 1967, that is in the accounting year relevant to the assessment year 1968-69, a property having an extent of about 16 cents situated in Ernakulam was purchased by the assessee. Inclusive of stamp and registration charges the investment came to Rs. 34,628. On November 27, 1968, relevant to the assessment year 1969-70, another property of about 12 cents in Ernakulam village was purcha....

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....amounts should necessarily be one given to her by somebody else, and that by no stretch of imagination could the assessee be credited with having earned this income in the course of the assessment year, or even be in a position to earn it, for a decade and more. The Tribunal took the view that although the explanation of the assessee was liable to be rejected, s. 69 of the I.T. Act conferred only a discretion on the ITO to deal with the investment as income of the assessee, and that it did not make it mandatory on his part to deal with the investment as income of the assessee as soon as the latter's explanation happened to be rejected. On this line of reasoning, the Tribunal allowed the two appeals and cancelled the assessment of the ITO. T....

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....nation would be whether the Tribunal was right in interfering with the discretion of the ITO and the AAC in having treated the value of the investment as the income of the assessee. The right of appeal to the Tribunal and the powers of the Appellate Tribunal are to be found in s. 254 of the Act. Under s. 254, the Tribunal is to pass " such orders on the appeal as it thinks fit ". This is a wide power that is conferred upon the Tribunal. Unlike the case of a second appeal to this court under s. 100 of the C.P.C., the power of interference by the Tribunal is not in any way limited to consideration of questions of law or otherwise, so that it is open to the Tribunal to interfere with the judicial discretion exercised by the lower authorities a....