COMMISSIONER OF INCOME TAX Vs. HARBANSLAL SODESH KUMAR RAWLLEY

JUDGEMENT

(1.) THIS is an application at the instance of the revenue under Section 256(2) of the Income-tax Act of 1961 (hereinafter referred to as "the Act") for a direction to the Income-tax Appellate Tribunal, Cuttack Bench, to state a case and refer the following question said to be of law arising out of the appellate decision of the Tribunal for the opinion of the court:

(2.) THE assessee is a registered firm. THE year of assessment is 1964-65. THE Inspecting Assistant Commissioner imposed penalty of Rs. 12,000 under Section 271(1)(c) of the Act on the basis that Rs. 20,000 claimed by the assessee to be loans from a particular source constituted income from undisclosed sources and the assessee, therefore, was liable to be penalised. THE Appellate Tribunal, in appeal against the levy of penalty, held: