Law:

Section:

Section 147 of the Income-tax Act, 1961 - Income escaping assessment - Position prior to 1-4-1989 - Assessment year 1956-57 - Assessee was carrying on money-lending business - ITO sought to re-open assessment as he was of opinion that there was substantial increase in lent capital from year to year and same was not commensurate with income assessed for various years - Assessee had been showing every year total investment which she had made in her business of money-lending -ITO was aware that total outlay of money-lending business had been growing year after year - Whether merely because new ITO felt that correct inference was not drawn, he could not re-open assessment to go into question as to how capital had swelled - Held, yes - Whether, therefore, notice issued by ITO under section 147(a) for reassessment was to be quashed - Held, yes FACTS The assessee was carrying on money-lending business. On the basis of returns and the statements and the account books, the assessment was made for the assessment year 1956-57. After a lapse of a few years, it was found by the ITO that year after year the assessee had filed along with the return a statement showing the particulars of amounts outstanding at the beginning of the year, fresh advances in the year, realizations during the year by way of principal and interest and the amount outstanding at the end of the year. She, however, did not file the trial balance or balance-sheet, nor did she show the cash balance on hand at the end of each year. It was found that the capital investment of the assessee by 31-3-1949, had swelled to Rs. 61,000. The lent capital went on increasing thereafter and reached the maximum of Rs. 2,21,482 by 31-3-1962. It was from these data that it became evident that there was substantial increase in the lent capital from year to year and the same was not commensurate with the income assessed for the various years. In the assessment proceedings for the year 1958-59, the assessee was required to explain the accretions in the outstandings from Rs. 61,000 on 1-4-1949, to Rs. 2,32,273 on 1-4-1957, together with cash balance on the opening day of each of the accounting years. She however, furnished…

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