- (1.) K .C.Agrawal 1. The Income -tax Appellate Tribunal, Allahabad Bench, Allahabadi has referred the following two questions of law for the opinion of this court under Section 256(2) of the Income -tax Act, 1961 (hereinafter referred to as 'the Act '): '(1) Whether, on the facts and in the circumstances of the case, the Tribunal was legally correct in holding that there was no failure on the part of the assessee to disclose fully and truly all the material necessary for the completion of the assessment for the assessment year 1960 -61 ? (2) Whether the Tribunal was legally correct in holding that the income, if addable at all, could have been added for the assessment year 1961 -62 but not for the assessment year 1960 -61?'
(2.) THE respondent, M/s Hasmat Rai Raj Pal (hereinafter called as 'the assessee'), is a registered firm. Its previous year is the year ending on 31st October. It maintained regular books of account. The assessee had some hundi transactions which were found recorded in its books maintained for the assessment year 1961 -62. During the course of assessment proceedings before the Income -tax Officer for the assessment year 1961 -62, the assessee filed a copy of the accounts of the creditors as appearing in the ledger with their addresses. The Income -tax Officer sent an intimation slip to the Income -tax Officer under whose jurisdiction the creditors were doing business. He did not wait for the reply from the Income -tax Officer concerned and completed the assessment on November 29, 1961. In this reference, we are concerned with the assessment year 1960 -61. The original assessment for this year was completed much earlier on February 2, 1961.
(3.) THE assessments for both the years mentioned above were completed under the provisions of the Indian Income -tax Act, 1922 (hereinafter referred to as ' the Act of 1922 ').;