Commissioner of Income Tax vs Mahabir Parshad Prem Chand

This order will also dispose of ITC No. 57 of 1987 as both these petitions arise out of a common order dated August 5, 1986, passed by the Tribunal whereby the Tribunal refused to refer the questions of law asked for by the Commissioner as also by the assessee. After hearing learned counsel for the parties, we are of the opinion that the following questions of law do arise from the order of the Tribunal:

(1) Whether the Tribunal was justified in assessing the addition of Rs. 69,000 as income from undisclosed sources out of the sum of Rs. 1,40,000 deposited by the assessee with the State Bank of India in the form of high denomination notes of the value of Rs. 1,000 each on January 19, 1978, out of the cash balance of Rs. 1,91,346 in his books of account on the said date?

(2) Whether, on the facts and in the circumstances of the case, the Tribunal erred in law in deleting an addition of Rs. 78,000 made by the income tax Officer under the head ''Income from undisclosed sources''?

The first question is being asked for on the application of the assessee while the second question is being asked on the application of the Commissioner. The tribunal will draw up a consolidated statement of the case and refer the aforesaid questions of law for the opinion of this court.