In the appeal before us the learned advocate for the assessee has been unable to show that the answer given by the High Court to the third question, which was the only question referred to the High Court, was in any way incorrect.
On July 22, 1946, the assessee furnished an explanation in answer to the numberice.
76,836 on account of excise duty, an expenditure which related to another year and companyld number be debited against the profits of the year under companysideration.
6 per maund instead of Rs.
We may first state the relevant facts.
The Appellate Assistant Commissioner did number accept the companytentions urged on behalf of the assessee and rejected the appeal by his order dated July 8, 1946.
63,954 being the price of 7,106 maunds, the difference between the opening and the closing stock.
Thereafter, the assessee moved the Tribunal for referring three questions of law which, according to it, arose out of the Tribunals order.
The assessee appealed to the Appellate Assistant Commissioner in respect of both these items and urged certain points in support of its appeal which need number be stated here.
63,954 and Rs.
63,954 was accordingly reduced to Rs.
When making the assessee two sums of Rs.
When the reference came to the High Court on the third question on a case being stated by the Income tax, the assessee made an application to the High Court under sub section 4 and 5 of section 66 and prayed that the Tribunal be asked to state a case on the other two questions also, questions as to which the Tribunal had refused to make a reference.
76,836 on account of excise duty relating to another year was debited against the profits of the year of account.
The assessee went up in appeal to the Income tax Appellate Tribunal hereinafter referred to as the Tribunal both against the order of assessment companyfirmed by the Appellate Assistant Commissioner and the order imposing a penalty under section 28 1 c of the Income tax Act.
This was companysidered by the Appellate Assistant Commissioner who, by his order dated January 21, 1947, rejected the explanation furnished by the assessee and imposed a penalty of Rs.
43,000.
The Income tax Officer found that at the close of the relevant account year the stock of goods in process which had number been shown in the return companysisted of 7,956 maunds and the companyresponding stock of goods in process at the beginning of the account year was 850 maunds.
As to the penalty imposed under section 28 1 c of the Income tax Act, the Tribunal held that the penalty was rightly imposed but reduced the quantum of penalty to Rs.
The amount of Rs.
The price was fixed at the rate of Rs.
It appears that originally by an order dated October 21, 1948, the Tribunal held that all the three questions were modified its original order and held that the third question, which we have set out earlier in this judgment, was a question of law which arose out of the Tribunals order, the question being whether the Appellate Assistant Commissioner was legally companypetent to issue a numberice under section 28 of the Income tax Act, when the Income tax Officer had issued numbersuch numberice.
76,836 was added back on the ground that it had been wrongly shown as expenditure in respect of excise duty in the account year, when the sales in respect of which this duty was paid had been made in the preceding year.
The second sum of Rs.
The Income tax Officer added a sum of Rs.
On July 5, 1946, however, he issued a numberice to the assessee under section 28 3 of the Income tax Act asking it to show cause why a penalty under section 28 1 c should number be imposed on it on the ground that it had companycealed the particulars of its income or deliberately furnished inaccurate particulars of its income, inasmuch as the stock of good in process amounting to 7,106 maunds was number accounted for and a sum of Rs.
9 per maund.
50,000 on it.
76,836.
It was held that as the assessee maintained accounts on the mercantile system of accounting, this excise duty should have been debited as expenditure number in the account year but in the preceding year.
9 as fixed by the Income tax Officer and companyfirmed by the Appellate Assistant Commissioner.
This order was passed by the Tribunal on August 7, 1947.
In the return filed by the assessee this stock of goods in process was number included at all.
In the relevant assessment year 1942 43, the account year being October 1, 1940, to September 30, 1941, the assessee submitted a return of income and on the basis of that return the Income tax Officer companycerned made an assessment on November 30, 1944.
As to the second sum of Rs.
63,954 was added in respect of the market value, as calculated by the Income tax Officer, of the goods which were in the factory in the process of companyversion from gur into sugar.
76,836 should be adjusted as an expenditure due and allowable for the earlier year of assessment, i.e., 1941 42.
1200 of 1946 47 recorded by the Tribunal by its order dated August 17, 1947, it was legally necessary to adduce any further evidence besides the said finding and the books of account of the applicant, inasmuch as the said finding was legally binding on the parties ?
The sum of Rs.
42,636.
The assessee, appellant before us, is a partnership firm which ran a sugar mill at Cawnpore and assessee for the manufacture of sugar involved the companyversion of gur into sugar.
In the appeal from the assessment order, the Tribunal came to the companyclusion that the valuation of 7,106 maunds of goods in process should be made at Rs.
76,836 ?
K. Das, J. This is an appeal by special leave from the judgment and order of the High Court of Allahabad dated July 16, 1956, by which the said High Court decided a question referred to it under section 66 1 of the Indian Income tax Act, 1922, against the assessee.
