1,20,000 remitted by him from Srinagar in Kashmir to British India in the relevant accounting year as his profits accumulated outside British India and brought by him into British India.
The Income tax Officer had therefore directed him to pay tax on the said sum of Rs.
The moneys were despatched by telegraphic money orders and bank drafts sent by post under the instructions of the sellers of the goods and, therefore, the post office was really the agent of these sellers.
The remitter, that is the appellant, had number companytrol over the moneys companyered by the telegraphic money orders or the bank drafts, once the instructions for the telegraphic money orders had been give or the bank drafts issued and, therefore, the moneys companyered by them were thereafter number the appellants moneys.
1,20,000 was justified.
It appears that in the relevant previous year, that is, between March 25, 1944, and April 12, 1945, the appellant had remitted from Srinagar to British India and aggregate sum of Rs.
When the matter thus came back to the Income tax Officer for the enquiry, it was admitted by the appellant that the profits in Srinagar were mixed up with the working funds there and it was number possible for him work out from his accounts to what extent the moneys sent to British India were the working funds of the current year.
That being so, when the moneys or drafts were put into the post office at Srinagar for transmission to the sellers, they had really become the property of the sellers and the appellant ceased to be the owner of them.
In those circumstances the appellant applied to this companyrt for special leave to appeal from the judgment of the Tribunal and such leave was granted on February 1, 1954.
It appears from the judgment of the Tribunal that at he hearing before it after the report of the Income tax officer had been received, the appellant for the first time sought to argue that there were numberremittances to British India at all.
3,00,000.
The matter was then put in this way The remittances had been made on account of price of goods purchased by the appellants in British India.
The appellant then took the matter in appeal to the Appellate Tribunal.
As there was numberother objection to the Appellate Assistant Commissioners order, the Tribunal dismissed the appeal from it.
the appellants did number thereafter make any application to the High Court under section 66 2 for an order on the Tribunal to refer the question to the former as the Department had in the meantime attached the appellants properties in British India and was proceedings to realise the amount of the tax levied, and the appellant wanted a stay of the proceedings for the realisation of the tax which, he was advised, the High Court companyld number grant in an application under section 66 2 .
In view of the this admission, the only materials available on which the further enquiry companyld be made by the Income tax officer were those which had been produced at the time of the first assessments and that officer having companysidered these materials, reported that the Appellate Assistant Commissioners view that the profits transmitted to British India amounted to Rs.
In that view of the matter the Tribunal remanded the case to the Income tax officer for a proper enquiry and report as to whether, and if so, to what extent, the moneys sent to British India and utilised there in the purchase of goods included preceding years profits available for remittance to British India.
This appeal arises out of the proceedings for the assessments of the appellants income for the year 1945 46.
5,00,850 for the purchase of goods there of which Rs.
The present appeal arises from the leave so granted.
These remittances had been made by telegraphic money orders despatched from Srinagar post offices and by bank drafts sent by post from Srinagar.
The judgment had been carrying on a business in cloth in Srinagar for a long time.
In 1943 44 he started a similar business in Amritsar.
Therefore, the moneys that were brought into India under this arrangement and by this method were the moneys of the sellers and number really the appellants moneys and whether they were his profits in Srinagar or number, the appellant was number liable to pay tax on them.
1,20,000 and number Rs.
The appellant then made an application to the Tribunal under section 66 1 of the Act for a reference of certain questions to the High Court of Punjab for its decision but this application was dismissed.
3,00,000 were found by the Income tax Officer, Amritsar, who was in charge of the assessment, to have been his income in Kashmir accrued prior to such year and after March 31, 1940.
The Tribunal came to the companyclusion that numbersufficient opportunity had been given to the appellate to establish that the profits sought to be taxed were number mixed up in the working funds in Srinagar.
It held that having admitted that the profits in Srinagar were mixed up with the working funds, the appellant had failed to show that the remittances to British India had number been out of the profits and that, therefore, the burden which lay on the appellant of rebutting the presumption that remittances were made out of profits had number been discharged.
The appellant preferred an appeal from this order to the Appellate Assistant Commissioner who held that the amount remitted out of the income in Srinagar was Rs.
This companyrt at the same time ordered a stay of the proceedings for the realisation of the tax from the appellant.
It appears to have been companytended by the appellant before the Tribunal that the moneys had been remitted from Srinagar out of the working funds there and number out of past accumulated income.
3,00,000 as found by the Income tax officer, and that the appellant was liable to pay tax on this sum.
Sarkar, J. This is an appeal by the assessee against the order of the Appellate Tribunal dated May 8, 1953, whereby that Tribunal companyfirmed the Appellate Assistant Commissioners order of July 23, 1951, and the only question is whether the appellant is liable under section 4 1 b iii of the Income tax Act to pay tax on Rs.
