D.K.Jain, C.J. - (1.) By this petition under Section 256(2) of the Income Tax Act, 1961(for short, the Act), the Revenue seeks a direction to the Income Tax Appellate Tribunal, Amritsar Bench, Amritsar (for short, the Tribunal) to state the case and refer the following question, for the opinion of this Court:- "Whether, on the facts and in the circumstances of the case, Ld. ITAT is right in law in deleting the addition of Rs,2,60,000/- made by Assessing Officer and confirmed by CIT(A) on account of unexplained credits in the capital accounts of partners."
(2.) At the outset, we may note that the present petition was dismissed vide order dated 2.9.1997 but subsequently on Revenue's moving an application, the said order was partly recalled on 26.10.1999. Under these circumstances the petition has now come up for hearing. Briefly stated the material facts, giving rise to the present petition, are as follows:- "During the course of assessment proceedings for the assessment year 1989-90, for which the relevant accounting period ended on 31.3.1989, the Assessing Officer noticed that in the capital accounts of the two partners, namely, S/s Kulwant Singh and Daljit Singh, amounts of Rs. 1,30,000/- each, Rs. 1,00,000/- by draft and Rs. 30,000/- in cash had been credited."
(3.) The assessee firm was asked to prove the genuineness of these two amounts. In furtherance thereto, wealth tax statements of the partners; copies of their assessment orders and pass books were furnished to the Assessing Officer. However, not being satisfied with the evidence produced, the Assessing Officer added the said amount of Rs.2,60,000/- to the returned income of the firm, as unexplained and ingenuine cash credits. Aggrieved, the assessee preferred an appeal to the Commissioner of Income Tax (Appeals) but without any success. Not being satisfied with the decision of the Commissioner(Appeals), the assessee carried the matter in further appeal to the Tribunal. Inter-alia, observing that the Bank drafts had been obtained by both the partners from their respective savings bank accounts, copies whereof had been produced before the Assessing officer; which fact was confirmed by the Bank and the financial standing of both the partners was sound, one of them,namely, Kuwlant Singh being in liquor business,by the impugned order, the Tribunal has deleted both the additions. The Tribunal has come to the conclusion that the initial onus with regard to the identity and the financial capacity, which lay on the assessee, under Section 68 of the Act stood discharged. Revenue's application under Section 256(1) of the Act having been dismissed by the Tribunal, the present petition has been filed. Dr.N.L.Sharda, learned counsel for the Revenue has vehemently submitted that the finding recorded by the Tribunal to the effect that the assessee has proved the credit worthiness and the genuineness of loan is perverse, in as much as the assessee had failed to adduce sufficient evidence to prove the capacity of the said parties. It is asserted that mere production of wealth tax statements does not per se prove the genuineness of the transaction and,therefore, addition under Section 68 of the Act was warranted. It is pleaded that a question of law does not arise from the order of the Tribunal and,therefore, Revenue's application under Section 256(1) was wrongly dismissed.;