Commissioner of Income Tax Vs. Bhital Das Modi (indl.) - Court Judgment |
| Direct Taxation |
| Allahabad High Court |
| Oct-01-2004 |
| IT Ref. No. 14 of 1988 |
| R.K. Agrawal and ;Prakash Krishna, JJ. |
| (2005)193CTR(All)574; [2005]276ITR517(All) |
| Income Tax Act, 1961 - Sections 68 |
| Commissioner of Income Tax |
| Bhital Das Modi (indl.) |
| Shambhu Chopra, Adv. |
| Shakeel Ahmed, Adv. |
.....terms. section 168 uses the word just compensation which, in our opinion, should be assigned a broad meaning. it cannot be lost sight of the fact that the private sector companies in place of introducing a pension scheme takes recourse to payment of contributory provident fund, gratuity and other perks to attract the people who are efficient and hard working. different offers made to an officer by the employer, same may be either for the benefit of the employee himself or for the benefit of the entire family if some facilities are being provided whereby the entire family stands to benefit, the same, must be held to be relevant for the purpose of computation of total income on the basis whereof the amount of compensation payable for the death of the kith and kin of the applicants is required to be determined. the amounts, therefore, which were required to be paid to the deceased by his employer by way of perks, should be included for computation of his monthly income as that would have been added to his monthly income by way of contribution to the family as contradistinguished to the ones which were for his benefit. from the said amount of income, the statutory amount of..........following question of law under section 256(1) of the it act, 1961 (hereinafter referred to as the act), for opinion to this court :'whether, on the facts and in the circumstances of the case, the tribunal was justified in deleting the, addition of rs.1,01,399,even though it represented unexplained cash credits and demand (sic-deemed) income under section 68 of the it act, 1961 ?'.2. briefly, stated the facts giving rise to the present reference are as follows : during the course of assessment for the asst. yr. 1976-77 the ito in the course of examination of the assessee's books of account, noticed various deposits in the names of 108 parties. on being asked to explain the nature and source of these deposits, the respondent-assessee was unable to furnish the addresses of depositors. however, he submitted that patients used to come for treatment at his place and were required to make a deposit. part of the deposit was adjusted towards the fees and expenses and remaining part was treated as deposit till such a time it was refunded to the depositor. the ito, however, added the entire amount from unexplained sources by invoking section 68 of the act, addition was deleted by, the.....
1. The Tribunal, Allahabad, has referred the following question of law under Section 256(1) of the IT Act, 1961 (hereinafter referred to as the Act), for opinion to this Court :
'Whether, on the facts and in the circumstances of the case, the Tribunal was justified in deleting the, addition of Rs.1,01,399,even though it represented unexplained cash credits and demand (sic-deemed) income under Section 68 of the IT Act, 1961 ?'.
2. Briefly, stated the facts giving rise to the present reference are as follows :
During the course of assessment for the asst. yr. 1976-77 the ITO in the course of examination of the assessee's books of account, noticed various deposits in the names of 108 parties. On being asked to explain the nature and source of these deposits, the respondent-assessee was unable to furnish the addresses of depositors. However, he submitted that patients used to come for treatment at his place and were required to make a deposit. Part of the deposit was adjusted towards the fees and expenses and remaining part was treated as deposit till such a time it was refunded to the depositor. The ITO, however, added the entire amount from unexplained sources by invoking Section 68 of the Act, Addition was deleted by, the CIT(A) on the ground that they were mere deposits and could not be treated as income. He found that the respondent-assessee had been maintaining regular accounts of patients for the moneys deposited by them, for the fee charged from them and refund of balance allowed to them. After examining number of items forming part of Annex. C to the assessment order, the CIT(A) found support for the above finding. The Revenue's appeal before the Tribunal has failed.
3. We have heard Shri Shambhu Chopra, the learned standing counsel for the Revenue, and Shri Shakeel Ahmed, the learned counsel appearing for the respondent-assessee.
4. From perusal of the order of the Tribunal, we find that the Tribunal has held that the deposits in question, were deposits arid not an income of the respondent-assessee. It was in the nature of security deposit which has been fully explained and, therefore, it should not have been added. From the finding;; recorded by the Tribunal, we are of the considered opinion that the provision of Section 68 of the Act was not applicable in the present case.
Consequently, we answer the question of law referred to us in affirmative, i.e., in favour of assessee and against the Revenue.