JUDGMENT

SABYASACHI MUKHARJI, C.J.I:- This is an appeal by special leave from the judgment and order of the Madras High Court dated 9th March, 1977. The appeal involves the assessment of income-tax under the Income-tax Act, 1961 (hereinafter referred to as the Act) for the assessment year 1966-67. The assessee is an individual who carried on business in distribution of films for the assessment year 1966-67. The assessee filed a return of income on 12th July, 1969 declaring "No loss". Subsequently, the assessee filed a revised return on 4th January, 1969 declaring a net loss of Rs. 9,490/- The Income-tax Officer called for wealth statements from the assessee. The wealth statements did not reveal that the assessee had invested any amount in the plot of land in T. Nagar. However, a raid made in the premises of E. V. Saroja and K. R. Sadayappan revealed the information that the assessee along with Smt. P. S. S. Ekammai Achi and A. L. M. Perianna Chettiar had purchased a plot of land in T. Nagar on 13-4-1965 from Smt. K. V. Saroja. The plot was purchased in the name of the, assessees son Sri Ramkrishnan.

2. In the assessment, it was stated that the total consideration was Rs. 80,000/- out