| Case ID |
10c3bf61-f9ff-40e2-a289-3d97e711311b |
| Body |
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| Case Number |
IT REFERENCE NO. 251 OF 1979 |
| Decision Date |
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| Hearing Date |
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| Decision |
The Kerala High Court held that the intangible additions made in the preceding years do not automatically imply that these funds were available to cover unexplained income in subsequent years. The assessee is required to establish that the funds were indeed drawn from intangible additions for investment in the subsequent year. The court remanded the case to the Tribunal for further inquiry into whether the assessee could substantiate the claims of cash credits being covered by the previous year's fund. The Tribunal's earlier acceptance of the plea without thorough investigation was not justified. |
| Summary |
This case deals with the interpretation of Section 68 of the Income-Tax Act, 1961 concerning cash credits. The Kerala High Court examined the claims of the assessee, who argued that the cash credits and unexplained investments were covered by intangible additions from the previous assessment year. The court underscored the necessity for the assessee to provide concrete evidence establishing that the funds utilized for current investments were indeed drawn from prior undisclosed income. This ruling emphasizes the importance of evidentiary standards in tax assessments and the complexities surrounding the treatment of cash credits and unexplained investments in income tax law. The decision highlights the need for rigorous scrutiny of claims made by the assessee, as the mere availability of funds does not suffice to explain cash credits or investments in subsequent years. It serves as a significant precedent for future cases involving similar circumstances, reinforcing the principle that each case must be evaluated based on its unique facts and evidence presented. |
| Court |
Kerala High Court
|
| Entities Involved |
Not available
|
| Judges |
T. Kochu Thommen,
K.P. Radhakrishna Menon
|
| Lawyers |
P.K.R. Menon,
T.L. Viswanatha Iyer
|
| Petitioners |
Commissioner of Income Tax
|
| Respondents |
M.A. Unneerikutty
|
| Citations |
1985 SLD 1207,
(1985) 154 ITR 844
|
| Other Citations |
Anantharam Veerasinghaiah & Co. v. CIT [1980] 123 ITR 457 (SC),
CIT v. Kulwant Kaur [1980] 121 ITR 914 (Delhi),
Abraham v. CIT ILR 1975 1 Ker. 426,
Lagadapati Subba Ramaiah v. CIT [1956] 30 ITR 593 (AP),
S. Kuppuswami Mudaliar v. CIT [1964] 51 ITR 757 (Mad.),
CIT v. Althi Bangarayya [1975] 100 ITR 10 (SC),
CIT v. Manick Sons [1969] 74 ITR 1 (SC),
B. Abdul Qadir v. CIT [1964] 52 ITR 364 (Mad.),
CIT v. Ram Sanehi Gian Chand [1972] 86 ITR 724 (Punj. & Har.),
CIT v. Ram Achal Ram Sewak [1969] 73 ITR 501 (All.),
CIT v. Sahu Bros. [1978] 115 ITR 438 (MP)
|
| Laws Involved |
Income-Tax Act, 1961
|
| Sections |
68
|