Law:

Section:

Section 147(a) of the income-tax act, 1961-Reassessment-Burden of proof-Whether burden lies on department to prove non-availability of admitted intangible additions of prior years for set off in subsequent year-Held, no-Whether period prescribed for taking action for reopening assessments was period of limitation and not a jurisdictional condition-Held, yes Facts Apart from his own proprietory business, the assessee was a partner in two firms. In the supplementary assessment proceedings for the assessment year 1948-49, the ITO included in the total income an amount of Rs. 65,000 representing unexplained credits to his capital account. On appeal before the Tribunal, the assessee attributed the source of these credits to the intangible additions made in the assessment years 1948-49 and 1949-50. However, the Tribunal allowed, on facts, only a set off of Rs. 15,000 out of the intangible addition of Rs. 17,000 for that year and rejected the other contention that the intangible addition of Rs. 48,000 was available for set off and consequently maintained the remaining addition. With the Board's prior approval under section 34(1A), the ITO reopened the assessment proceedings for the second time to rope in the unledgerised cash credits of Rs. 1,29,700 appearing in the assessee's name in the books of the firm. The ITO apportioned this amount as relevant to two years, namely, Rs. 68,700 in the assessment year 1950-51 and Rs. 61,000 in the assessment year 1951-52. The assessee argued that the ITO had no jurisdiction to reopen the assessment and that the said unledgerised credits flowed from the intangible additions of larger amounts made in the assessment of that year as well as in the earlier years. Since these arguments did not carry convictions, the ITO added in the total assessable income the peak amount of Rs. 49,700 which fell in the relevant accounting year. The AAC upheld the ITO's order. The Tribunal overruled the objection qua jurisdiction and, on merits also, it dismissed the appeal. The Tribunal held that it was for the assessee (a) to explain the cash credits and to trace their sources, and (b) to substantiate with proof the explanation with respect of certain…

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