Income-tax---

----Reference---Accounting---Rejection of accounts---Estimate of income-- Finding that accounts were not reliable---Tribunal justified in rejecting the books of account and estimating the income---No question of law arose-- Indian Income Tax Act, 1961, Ss. 145 & 256.

The assessee who was a legal practitioner, returned incomes of Rs.540, Rs.920 and Rs.(-) 35 and Rs.1,170 for the assessment years 1977-78, 1978-79, 1979-80 and 1980-81, respectively. The Assessing Authority did not accept this position and estimated the annual income for all these years at Rs.6,000 per annum. The assessee filed appeals before the Assistant Commissioner which were rejected. The Tribunal upheld the orders and observed that a person engaged as legal practitioner could not earn a low amount as shown by him. The assessee did not produce the diaries. On an application to direct reference of the question whether the Tribunal was right in law in rejecting the accounts, drawing an adverse inference from the non production of diaries and in the estimate of income:

Held, dismissing the application that the order of the Tribunal was based on an appreciation of facts and did not give rise to any question of law.

CIT v. Ashoka Marketing Ltd. (1976) 103 ITR 543 (SC) and CIT v. Kotrika Venkataswamy & Sons (1971) 79 ITR 499 (SC) ref.

S.C. Bagdiya for the Assessee

D.D. Vyas for the Commissioner.

JUDGMENT

A. R. TIWARI, J.---The assessee has filed this application under section 256(2) of the Income Tax Act, 1961 (for short "the Act") seeking a direction to the Tribunal to state the case and refer the proposed question of law, as noted below, arising out of the order passed in Income-tax Appeals Nos. 1069 to 1074/Ind of 1985 for the assessment years 1974-75 to 1980-81, for our consideration and opinion:

"(1)Whether, in the facts and circumstances of the case, the Appellate Tribunal was right in law in holding that the books of account of professional lawyer could be rejected on the ground that the income is low and cannot be expected of the whole-time legal practitioner, when this was not the ground of rejection of the account books by the Income-tax Officer or the Appellate Assistant Commissioner?

(2)Whether, in the facts and circumstances of the case, the Appellate. Tribunal could in law draw any adverse inference from the non production of the diary by the assessee when neither the production of the diary was required by any lower authority nor by the Appellate Tribunal except by the casual question during the course of hearing as to whether the assessee has brought his diaries with at him?

(3)Whether, in the facts and circumstances of the case, the estimate of the assessee's income being arbitrary and without any basis could be sustained in law by the Tribunal?"

On the application of the assessee, registered as Revision Application No.55/Ind of 1987 one question was referred by the Tribunal. As the other questions were not referred, the assessee has filed this application under section 256(2) of the Act.

Briefly stated, the facts of the case are that the applicant is a legal practitioner. He returned professional income for the respective years at Rs.540, Rs.920, Rs.(-) 35 and Rs.1,170 for the assessment years, respectively, 1977-78, 1978-79, 1979-80 and 1980-81 The authority did not accept this position and estimated the annual income for all these years at Rs.6,000 per annum. Aggrieved, the assessee filed appeals before the Assistant Commissioner which were rejected (Annexure "F"). The assessee then filed the appeals before the Tribunal. The Tribunal upheld the orders and observed that a person engaged as legal practitioner could not be held as earning such a low amount as shown by him. The assessee did not produce the diaries.

We have heard Shri S.C. Bagdiya, learned counsel for the applicant/assessee and Shri D.D. Vyas, learned counsel for the non applicant/Department.

We have considered the application and as also the submissions. In our view, the order of the Tribunal is based on an appreciation of the facts and features and does not give rise to the proposed questions.

The finding reached on appreciation of facts does not give rise to any question of law as held in CIT v. Ashoka Marketing Ltd. (1976) 103 ITR 543 (SC) and in CIT v. Kotrika Venkataswamy & Sons (1971) 79 ITR 499 (SC).

In the result, we are satisfied that no case is made out4or issuing a direction to the Tribunal.

The application is accordingly dismissed but without any order as to costs.

Counsel fee for each side is, however, fixed at Rs.750, if certified.

M.B.A./1441/FCApplication dismissed.