Law:

Section:

Section 143 of the Income-tax Act, 1961 [Corresponding to section 23 of the Indian Income-tax Act, 1922] - Assessment - Addition to income - Assessment years 1943-44 and 1946-47 - Whether if from books of account of assessee it appears that during relevant period he had received certain sums of money, it is for assessee to explain from where he got same and if his explanation is accepted there is end of matter - Held, yes - Whether when assessee furnishes an explanation, if that explanation is unsatisfactory, that may in itself be a circumstance which ITO may be entitled to take into consideration but it need not necessarily, in every case, lead to conclusion that receipt is a revenue receipt taxable as income received in a particular year - Held, yes FACTS The assessee-HUF carried on business in grain, cloth, commission agency, speculation, etc. During the assessment year 1943-44, the ITO found a cash deposit of Rs. 5,000 in the capital account of the assessee in the name of S entered on 25-10-1941. Similarly for the assessment year 1946-47 there were three credit entries in the capital account, in the names of 'S' 'SD' and 'DD'. The assessee's explanation about the deposit of Rs. 5,000 in the assessment year 1943-44 was that it was covered by the previous withdrawal of Rs. 30,000 made on 18-7-1940, from the accounts of 'SD' and 'DD' respectively in which names the capital accounts of the assessee family stood, whereas his explanation in regard to the cash deposits of Rs. 65,000 appearing in the accounts relating to the assessment year 1946-47 was that the amounts had been brought from the previous withdrawals and in support of this plea he produced his accounts to show that the sum of Rs. 50,000 had been withdrawn on 10-9-1936 from the S's account, Rs. 10,000 had been withdrawn from the account of SD on 18-7-1940 and Rs. 5,000 had been withdrawn on the same date from DD account. The income-tax authorities did not accept assessee's explanation and treated the aforementioned sums as profits from undisclosed source. On appeal, the Tribunal pointed out that the assessee could not have kept such large sums of money lying idle for such long periods and the assessee…

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