Law:

Section:

Section 69 of the Income-tax Act, 1961 - Unexplained investments - Assessment years 1986-87 to 1988-89 - In course of a search and seizure operation, it was found that assessee-HUF had constructed a property - As regards sources of funds towards said construction, assessee stated that amounts had been taken from various individuals and entities including funds of assessee in individual capacity - Assessing Officer was not satisfied with said explanation - Assessee's further explanation, that a major chunk of investment in construction had been financed by firm 'A', was also not accepted on ground that department had not accepted existence of aforesaid entity - Thus, he treated entire investment in house property as unexplained investment and made addition under section 69 - Commissioner (Appeals) deleted said addition on ground that investment in construction had been properly explained by withdrawals shown by assessee which were also found at time of search inasmuch as entries recorded in seized material, with respect to source of funds for construction, tallied with assessee's statements - In absence of any rebuttal of said evidence by revenue, Tribunal upheld order of Commissioner (Appeals) - Whether Tribunal was justified in doing so - Held, yes R.K. Upadhyaya for the Applicant. Amitabh Agrawal for the Respondent. ORDER 1. The Income-tax Appellate Tribunal, Delhi has referred the following questions of law under section 256(1) of the Income-tax Act, 1961, (hereinafter referred to as 'the Act') for opinion to this Court : "1. Whether on facts and in the circumstances of the case, the ITAT was legally correct in deleting the addition of Rs. 4,58,000 for assessment year 1987-88 in respect of credits shown from various parties despite the non-satisfaction of the conditions laid down under section 68 of the Income-tax Act by the assessee in respect of the credits? 2. Whether on the facts and in the circumstances of the case, the ITAT was legally correct in deleting the addition of Rs. 3,83,000 for assessment year 1986-87 in respect of credits shown from various parties despite the non-satisfaction of the conditions laid down under section 68 of the Income-tax…

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