G.C. Gupta, J. - (1.) The assessee has come up in appeal under Sec. 260A of the Income Tax Act, 1961 (hereinafter referred to as the 'Act') against a judgment and order passed by the Income Tax Appellate Tribunal, 'D' Bench, Kolkata in ITA No. 2541 (Cal) of 2003 dated 29th April, 2004 pertaining to the assessment year 1996 -97.
(2.) The following substantial questions of law arise for determination in the instant appeal: - - "I) Whether on a true and proper interpretation of Sec. 68 of the Act the Learned Tribunal was correct in law in treating the accumulation of capital in the books of the petitioner as an undisclosed income when on the contrary there was enough materials on record to prove that the capital found in the books of account of the petitioner was nothing but contributions received by way of gifts by the petitioner from various persons, proof of which had been adduced before the first appellate authority i.e. the CIT(A) who had on a proper appreciation of the facts deleted the addition? II) Whether the order of the Learned Tribunal giving a complete go -bye to the findings of the CIT(A) and thereafter confirming the order of the Assessing Officer was perverse -
(3.) Briefly stated the facts and circumstances of the case are as follows: - - "The assessee an individual, filed his return of income for the assessment year 1996 -97 indicating therein a total income of Rs. 42,760/ -, which was processed u/s. 143(1)(a). Upon examining the return filed for the assessment year 1995 -96 the Assessing Officer (hereinafter referred to as 'the AO') observed that the closing stock appearing in the Trading and Profit and Loss Account for the year ended on 31st March 1995 was Rs. 85,960/ - whereas the opening stock appearing in the Trading and Profit and Loss Account for the year ended on 31st March 1996 was Rs. 1,35,960/ -. Hence there was a difference of Rs. 50,000/ -. Similarly, the closing capital in the Balance -Sheet as at 31st March 1995 was Rs. 49,550/ - and the opening capital according to the Balance -Sheet as at 31st March 1996 was Rs. 3,76,100/ - and hence there was a difference of Rs. 3,26,550/ -. The A.O. reopened the assessment under Sec. 147 and issued notice to the assessee u/s. 148. However no one appeared in response to the notice. Thereafter the case was fixed for hearing on three several occasions but even then no one turned up. By an order dated 14th March, 2001 u/s. 144 r/w 147, the assessing officer made an addition of Rs. 3,26,550/ - on account of increase in opening capital and an amount of Rs. 50,000/ - on account of increase in opening stock. The assessing officer by the aforesaid order held as follows: - - "As nobody appeared to explain the case it is assumed that the assessee has no valid explanation regarding this increase in opening stock and opening capital. It is treated that this increase of Rs. 50,000/ - in opening stock and Rs. 3,26,550/ - in opening capital is income from undisclosed source of the assessee. This amount is added back to the total income of the assessee.";