Chakravartti, C.J. - (1.) In our opinion this Reference is incompetent and for the following reasons.
(2.) The assessee is a firm, going by the name of Khestsidas Ratanlall, Calcutta, and composed of two partners, named Khestsidas Dugar and Labhuram Nakhata, whose shares are equal. The firm is stated to have started business on 16-8-1944. The books of the firm showed that on that date two sums of Rs. 25,000/- each were deposited by the two partners, each depositing a sum of Rs. 25,000/- Naturally, the Income-tax Officer asked the assessee to satisfy him as to the source of the deposits and the explanation given was that the partners had brought the money from their native place at Bikaner. The Income-tax Officer was not satisfied and brought the two sums under assessment income of the firm from undisclosed sources. The Appellate Assistant Commissioner confirmed that finding.. When the matter was taken on further appeal to the Appellate Tribunal, it was no longer contended that the explanation given as to the source of the money should be believed, but what was argued was that inasmuch as the deposits were made on the very first day that the firm commenced its business, they could not possibly be profits of the firm from any source, disclosed or undisclosed. Consequentially to that submission, it was contended that the Hums Jell properly to be assessed in the hands of the two partners who had made the deposits as parts of their income. When the case was put before the Tribunal in that form, the Tribunal disposed of it by saying that inasmuch as the firm was a registered firm, whether or not the two sums in question were assessed as the income of the firm or the income of the two partners was of no practical consequence, since even if assessed, in the first instance, as the income of the firm, they would have to be taxed in the hands of the partners. In that view, the Tribunal declined to entertain the argument of the assessee and observed that it was "more or less academic". It will be noticed that the Tribunal did not decide for themselves whether the two sums had been properly assessed as the income of the firm or whether, in view of the date when they made their appearance in the firm's books, they should have been taxed, if at all, in the hands of the two partners. It should also be noticed that there was no contention before the Tribunal as to the two sums not being concealed income from undisclosed sources of either, the firm or the partners.
(3.) After the Tribunal had disposed of the appeal, the assessee asked for a reference to this Court and the Tribunal referred the two following questions: 'Whether the sum of Rs. 50,000/- appearing as cash credits on the opening date of the business can be treated as the income of the assessee firm from some undisclosed sources?" AND (2) "If not, whether on the facts and in the circumstances of this case the sum of Rs. 50,000/- should be included in the assessment of the two individual partners, one half each?";