Sinha, J. - (1.) THE Income-tax Appellate Tribunal has referred the following two questions for the opinion of this court: " 1. Whether, on the facts and in the circumstances of the case, there was any material for the Tribunal to disallow the sum of Rs. 20,795 on account of loss by fire ? 2. Whether, on the facts and in the circumstances of the case, the payment of sales tax composition fee of Rs. 1,91,887 was an allowable expenditure for the assessment year 1968-69 ? "
(2.) THE facts relevant to the first question are as follows: THE assessee deals in the business of manufacture and sale of biris. In the previous year relevant to the assessment year 1968-69, the shop of the assessee at Meerganj was set on fire in communal disturbance. According to the assessee, a wall clock of the value of Rs. 100, 40 bags of biris valued at Rs. 10,400, match boxes of the value of Rs. 3,794, furniture worth Rs. 1,500 and cash amount of Rs. 5,000 were burnt. THE total loss was calculated by him at Rs. 20,795 and he claimed the deduction thereof from the income of the year. THE ITO did not accept the claim nor was it accepted by the AAC and the Appellate Tribunal. Obviously, the petitioner could not claim exemption of the aforesaid amount unless he had proved that goods and cash to that extent were burnt in the fire. The finding recorded by the ITO, the AAC and the Appellate Tribunal is that the assessee failed to prove that loss. All the three authorities took into account the fact that no account books were produced in order to show as to what goods the shop contained on the date on which it was set on fire. Learned counsel for the assessee did not controvert this fact in his argument before us. It was, however, urged by him that the account books were destroyed in the fire and it was humanly impossible for the assessee to produce those account books. There was, however, no document to show that the account books were in the shop when it was set on fire and that they too had been destroyed. Reference was made by the learned counsel for the assessee to a letter that was sent by the assessee to the police in connection with that fire which was presumably treated as first information report. A copy thereof is made annex. " C " to the statement of the case and a perusal thereof shows that even the first information report did not mention that the account books had also been destroyed as a result of the fire. No doubt, at the time of argument before the Appellate Tribunal, it was urged that the account books were destroyed by fire. Since, however, there was nothing in support of that fact, the Appellate Tribunal could very well refuse to accept that statement.
(3.) IN the context of what has been said above, it cannot be held that the I.T. authorities committed any error in disallowing the claim of Rs. 20,795. The facts relevant to the second question are as follows: As already stated earlier, the assessee deals in the business of manufacture and sale of 6ms. By the notification published in the U.P. Gazette, Extraordinary, dated 14th December, 1957, it was provided that no tax was payable with effect from December 14, 1957, in respect of biris provided that the additional central excise duties leviable thereon from the close of business on December 13, 1957, had been paid. Another notification published in the same Gazette provided that no tax under the Central Sales Tax Act was payable by any dealer, registered under Section 7(3) of the Central Sales Tax Act and having his place of business in U.P., in respect of sales made by him of bins in the course of inter-State trade and provided they were sales to a dealer who had his place of business outside U.P. After the aforesaid notification the assessee took the view that he was not liable to pay any sales tax on sales effected from December 14, 1957. The sales tax dept., however, held that sales tax was payable for the period from December 14, 1957, to June 30, 1958, but was not payable beyond that date. On 6th May, 1959, the Bins Manufacturing Association of Allahabad made a petition to the Minister of Finance, Govt. of Uttar Pradesh, praying that the Government pass orders for the exemption of sales tax on biris for the period commencing from December 14, 1957, to June 30, 1958. The assessee also made an application that pending the decision of the State Govt., the recovery of the tax may be stayed. This stay was granted. On June 10, 1959, the assessment was made for the period from April 1, 1957, to March 31, 1958, and assessment for the period from April 1, 1958, to March 31, 1959, was made on February 12, 1963. An amount of Rs. 1,14,357 was determined as payable on sale of biris for the period from December 14, 1957, to March 31, 1958, and a sum of Rs. 81,994 was found payable for the period from April 1, 1958, to June 30, 1958. The total comes to Rs. 1,96,351. The stay granted in the year 1959 was vacated on October 16, 1957. Thereafter, an amount of Rs. 1,91,887 was paid (out of the aforesaid amount of Rs. 1,96,351)by the assessee. He claimed exemption for this amount in the year 1968-69, on the ground that the actual payment was actually made in that year. The claim has not been allowed by the ITO, the AAC as well as the Appellate Tribunal, all of whom consistently held that liability for payment of the tax occurred during the year when the sales took place and that it was not material that the payment was made in the assessment year 1968-69. ;