Law:

Section:

Section 28(i), read with section 37(1), of the Income-tax Act, 1961 - Business income - Chargeable as - Assessment years 1994-95 to 1996-97 - Assessee filed returns of income admitting that in course of business, it had received sub-stantial amounts from Animal Husbandry Department (AHD), but claimed that 80 to 90 per cent of amounts, thus, received had to be paid by way of bribe to officials of AHD and others, and, therefore, that part of amount received by it was not liable to be assessed as its income - Since assessee failed to prove payments as claimed, Assessing Officer assessed entire amount received by assessee in its hands - Appellate authorities upheld impugned order - Whether an attempt to show generally that there was a cattle-feed scam in State of Bihar and investigations by Central Bureau of Investigation were on and that it indicated modus operandi, were not sufficient to enable assessee to claim that out of income received by it, a substantial portion should be excluded on basis that it was a business expenditure or that it had not actually come to credit of assessee - Held, yes - Whether, therefore, entire amount received by assessee was rightly assessed in its hands - Held, yes FACTS The assessee in response to notices issued under section 148, filed relevant return of income admitting that in the course of business, it had received substantial amounts from the Animal Husbandry Department (AHD), but claimed that 80 to 90 per cent of the amounts, thus, received had to be paid by way of bribe to the officials of the AHD and others and, therefore, that part of the amount received by it was not liable to be assessed as its income. The Assessing Officer took the view that the assessee having admitted the receipt of the amount and having failed to prove the expenditure as claimed by it, the entire amount was liable to be assessed at the hands of the assessee. On appeal, the Commissioner (Appeals) confirmed the impugned order holding that the assessee had failed to adduce any evidence in support of payment of 80 to 90 per cent of the amount received by it from the AHD to any other person as bribe or otherwise. On further appeal, the Tribunal upheld…

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