Law:

Section:

Section 256 of the Income-tax Act, 1961 [Corresponding to section 66 of the IndianIncome-tax Act, 1922] - High Court - Reference to - Question referred to High Court was as to whether there was any material before Tribunal on which it could be held that gold, which assessee sold in accounting year, had been purchased in year 1918 and that amount entered in books represented proceeds of that sale - Statement of case, however, did not state any thing on which Tribunal decided instant case except only contentions of parties - Whether statement of case referred was insufficient to determine question raised - Held, yes (Case remanded back) FACTS The amount in question appeared in the books of the assessee in the name of his father. The assessee's explanation was that he had purchased some gold in 1918 and had kept it with him till the accounting year when he had sold it for the sum entered in the books and that it had been entered in his father's name, because such was the Marwari custom. Except the statement of the assessee that the gold had been purchased in 1918, there was no evidence either in the shape of the books of the assessee himself or papers of the party from whom the purchase had been made. Both the ITO and the AAC held that the purchase of gold in 1918 had not been proved and in their view the gold, the sale of which had yielded the sum found in the books, had been purchased with secret profits of the assessee. On further appeal, the members of Tribunal who heard the appeal reversed the order of the AAC. The application for reference was heard by another two members who allowed the application and the referred the question which was whether there was any material before the Tribunal on which it could be held that the gold which the assessee sold in the accounting year had been purchased in the year 1918 and that the amount entered in the books represented the proceeds of that sale. HELD The statements in the case referred were clearly insufficient to enable to determine the question raised. The appellate order passed in the case was a striking example of what appellate orders should not be and the statement of the case itself was an example of the…

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