V.G. Oak, C.J. - (1.) THIS reference raises the question of the true scope of a remand order under Section 31 of the Indian Income-tax Act, 1922. The assessee is a registered firm constituted by four partners, who are brothers. The assessment year is 1954-55. The Income-tax Officer noticed that in the account books of the firm for the corresponding previous year there were five credit entries. The first credit entry was for a sum of Rs. 8,502 in favour of the mother of the four partners. There were similar entries in the names of the wives of the four brothers. The total of the five amounts came to Rs. 42,117. The assessee's case was that capital was introduced by selling ornaments belonging to the five ladies. THIS explanation was not accepted by the Income-tax Officer. It was held that the alleged sale proceeds represented concealed income of the firm. However, the Income-tax Officer included in the assessment only one deposit, namely, that of Rs. 8,502 recorded in the name of Smt. Saraswati Devi, mother of the partners. Interest credited in favour of the ladies was also added.
(2.) THE assessment order was challenged in appeal by the assessee. One of the grievances of the appellant was that the assessee did not get an opportunity to examine the ladies to prove the assessee's case. THE Appellate Assistant Commissioner thought that there was substance in this grievance. THE case was, therefore, remanded for fresh assessment. After remand the case was disposed of by another Income-tax Officer. He agreed with his predecessor-in-office that all the five credit entries represented income of the firm. He, therefore, assessed tax for all the five credit entries and also for the interest on the various amounts. This decision was upheld in appeal by the Appellate Assistant Commissioner and by the Appellate Tribunal. Upon an application by the assessee, the following question of law has been referred to this court : " Whether, on the facts and in the circumstances of the case, was the Income-tax Officer in making a fresh assessment in pursuance of the appellate order setting aside the assessment, empowered to include the deposits other than that of Rs. 8,502 in the name of Smt. Saraswati Devi, as the income of the firm ? "
(3.) MR. P. N. Pachauri appearing for the assessee has urged that it was not open to the second Income-tax Officer to take up the question whether the four amounts credited in the names of the four wives represented income of the assessee. On the other hand, it has been urged for the department that this question was open before the second Income-tax Officer. Whether the question was open or not largely depends upon the nature of the remand order. The operative part of the remand order ran thus : " I have therefore no other alternative but to set aside the assessment on this ground and to direct the Income-tax Officer to make a fresh assessment after examining the ladies according to their wishes." ;