( 1 ) BEING aggrieved by the order passed by the Income-tax Appellate Tribunal, Ahmedabad Bench C, Ahmedabad (hereinafter referred to as the Tribunal), in R. A. No. 869/ahd/1997 the Commissioner of Income-tax, Surat ( CIT for short) has filed this application before this Court under section 256 (2) of the Income-tax Act 1961 (hereinafter referred to as the Act) for referring the following questions of law:"1 whether on facts and in the circumstances of the case, the I. T. A. T. was justified in law in admitting a new plea contrary to the facts on record that the net profit in respect of the supervision charges should be linked to the receipts of booking of flats to the tune of Rs. 2. 63 crores contrary to the provisions of Rule 29 read with rule 10 of the Appellate Tribunal Rules and to base its finding thereon ? 2. Whether on the facts and circumstances of the case the ITAT having held that assessee has received unaccounted receipts was justified in law in holding that the assessing officer has to discharge onus in respect of on money by showing that assessee has invested Rs. 1,58,59,400. 00 out of such receipts whereas claim of assessee for extra expenditure was found to be incorrect ?

( 2 ) SO far as question no. 1 is concerned the Tribunal in para 8 has recorded as under:"as regards question no. 1 raised by the Revenue, it is seen that the question talks about acceptance of new plea contrary to provisions of Rule 29 read with Rule 10 of the Appellate Tribunal Rules. However, neither any fact contrary to record was stated by the assessee nor it has been noted by the Tribunal in its order and as such Rule 10 is not applicable. Similarly no additional evidence was produced by the assessee. As such Rule 29 is also not applicable because a new plea cannot be equated with the new evidence"

( 3 ) SO far as question no. 2 is concerned it may be stated that the same has been raised on the premise that the claim for extra expenditure having been incurred by the assessee for earning on - money was found to be incorrect. The Tribunal has expressed the view that this premises itself is incorrect because the Department has failed to prove that the claim of the assessee regarding extra expenditure as incorrect. On the other hand, as a result of search by the Department, no unaccounted assets/investments exceeding Rs 30 lacs were found by the Department. Before us it was submitted that one Uttamchand Jain who purchased two flats entered into an agreement. Said document was signed by Uttamchand Jain, M. D. Patel and Udai Tejani. It seems that on the top of the page "465 per sq. ft" was mentioned and the sale price of each flat has been calculated accordingly for arriving at a conclusion. The agreement does not refer to the said price. Mr. Naik submitted that statement of architect was recorded. Uttamchand Jain has come out with the version that no premium was paid. Except the paper found from Madhavji nothing is placed on record to draw an inference against the assessee. No statement of other flat owner is recorded.

( 4 ) MR. Soparkar for the respondent assessee has relied upon a decision of the Division Bench of this Court (Coram: R. Balia and A. R. Dave. JJ) rendered in Income-tax Application No. 53 of 1999 on 20. 4. 1999 in the case of Commissioner of Income-tax vs. President Industries. In this case, the Division Bench has observed as under:". . IT cannot be matter of an argument that the amount of sales by itself cannot represent the income of the assessee who has not disclosed the sales. The sales only represented the price received by the seller of the goods for the acquisition of which it has already incurred the cost. It is the realisation of excess over the cost incurred that only forms part of the profit included in the consideration of sales. Therefore, unless there is a finding to the effect that investment by way of incurring cost in acquiring goods which have been sold have been made by the assessee and that has also