Y.R.Meena, J. - (1.) By this reference the Tribunal has referred the following two questions for our opinion : "(1) Whether, on the facts and in the circumstances of the case, the Tribunal was right in law in holding that there was no failure on the part of the Commissioner of Income-tax (Appeals) to carry out the mandate contained in the Tribunal's order dated the twenty-third day of July one thousand nine hundred and seventy five ? (2) Whether on the facts and in the circumstances of the case, the several findings of the Tribunal on which its conclusion is based are perverse and/or unsupported by any evidence ?"
(2.) The assessee is a private limited company which used to be regularly assessed under the provisions of the Indian Income-tax Act, 1922. The year under consideration is the assessment year 1960-61. In the year under consideration, the assessee had shown certain credits on account of hundi loans. The assessment was completed treating these hundi loans as genuine. Thereafter it was brought to the notice of the Income-tax Officer by some employees of the assessee that the hundi loans are not genuine. On the basis, the assessment was reopened under Section 147(a) of the Income-tax Act, 1961 (hereinafter referred to as "the Act"). After reopening of the assessment, the Income-tax Officer issued notices to the creditors at their addresses given by the assessee, but the notices came back unserved with the remarks "not known" and "nobody in this name stays here". In the absence of response, the Income-tax Officer came to the conclusion that all the hundi loans represented the assessee's income from undisclosed sources and he reassessed the income by addition of hundi loans at Rs. 2,65,912.
(3.) This reassessment order was challenged before the Appellate Assistant Commissioner. The Appellate Assistant Commissioner cancelled the assessment order on the ground that reopening was bad in law. Thereafter the Revenue preferred an appeal before the Tribunal and the Tribunal on consideration of the rival submissions found that the reopening under Section 147(a) of the new Act, 1961 was in accordance with law and restored the matter to the Appellate Assistant Commissioner for fresh disposal on the merits. Then the appeal was transferred to the Commissioner of Income-tax (Appeals).;