Prakash Krishna, J. - (1.) The Income Tax Appellate Tribunal, Allahabad, has referred the following questions of law under Section 256 (1) of the Income Tax Act, 1961 (here in after referred to a the Act) for opinion of this Court, relevant to the assessment year 1976- 77: "1- Whether in law and on the facts of the case the Tribunal was justified in holding that the remaining amount of refund of excise duty of Rs. 30,851/ which was distributed amongst the partners of the firm was not the income of the assessee firm. 2- Whether in law and on the facts of the case the Tribunal was justified in holding that the amount of Rs. 30,851/- was not assessable under Section 41 (1) of the Income tax Act, 1961 in the year under consideration,"
(2.) The brief facts of the case are as follows: The assessment for the assessment year 1976- 77 was initially completed by the assessing authority but was subsequently set aside by the Commissioner of Income Tax (Appeals) vide his order-dated 14-11-1979. The revised return on 13-02-1979 showing total income of Rs. 1,89,410/- as against the assessed income of Rs. 3,22,900/- was filed. The Commissioner of Income Tax (Appeals) while setting aside the original assessment order directed the assessing authority to also take into account the revised return. In the revised return the assessee credited unclaimed excise duty in the profit and loss account amounting to Rs. 30,851/-. The ITO found that the assessee had received a sum of Rs. 90,924/- in the accounting year 1969-70 from M/s Varuna Sales Limited, Ahemdabad towards credit note of the excise duty. The assessee out of the said amount did not refund Rs. 30,821.40 to the customers and the same was credited in the assessment year 1976- 77. This amount was added to the total income of the assessee by the ITO but was set aside by the Commissioner of Income Tax (Appeals) in the appeal preferred by the assessee. The Tribunal has confirmed the order of Commissioner of Income Tax (Appeals).
(3.) Heard learned Standing Counsel for the department. None appeared on behalf of the assessee as Sri R.S.Agarwal, Advocate, has stated that he has no instruction in the matter.;