Law:

Section:

Section 4 of the Income-tax Act, 1961 - Income - Assessable as - Assessment year 1975-76 - During relevant previous year Central Government increased sale price of fertilizers - So assessee sold existing stock of fertilizers at increased price - Subsequently Government issued a clarification that enhanced price would not apply to existing stock - Accordingly, district authorities called upon assessee to deposit excess amount realised by it from customers in post office - Out of total excess amount of Rs. 22,057 realised, assessee deposited only a sum of Rs. 7,000 in post office - Whether balance amount of Rs. 15,057 constituted assessee's income of relevant previous year - Held, yes FACTS During the relevant previous year the sale price of fertilizers was increased by the Central Government. So the assessed sold the existing stock of fertilizers at the increased sale price. However, the U.P. Government issued a clarification that the enhanced price of fertilizers would not apply to the existing stock. The District authorities, accordingly, called upon the assessee to deposit the excess amount realised by it from the customers in a post office in the name of the District Magistrate. Out of the excess amount of Rs. 22,057 realised, the assessee deposited only a sum of Rs. 7,000 in the account and kept the remaining amount of Rs. 15,057 with itself. The ITO included the total amount of Rs. 22,056 in the assessee's income. On appeal, the AAC excluded the amount of Rs. 7,000 from the assessee's income and sustained the addition of Rs. 15,057. On second appeal, the Tribunal deleted the addition of Rs. 15,057 made in the income of the assessee. On reference: HELD It was evident, in the instant case, that the assessee had chosen to treat the amount of Rs. 15,057 as its trading receipt, notwithstanding its claim to the contrary. Accordingly, the amount of Rs. 15,057 constituted the income of the assessee of the relevant previous year and in case the assessee's right was finally negatived it would be entitled to claim deduction of the said amount in that year. CASE REFERRED TO Govind Prasad Prabhu Nath [IT Appeal No. 2126 of 1975-76]. JUDGMENT Reddy, CJ.-We have heard…

Deprecated: trim(): Passing null to parameter #1 ($string) of type string is deprecated in /home/digixyei/sldsystempk.com/view/master-layout/view_case.php on line 492