( 1 ) THIS is a reference under Section 66 (1), Income-tax Act. The question referred is:

"whether in the circumstances of the case the Income tax Officer, E. P. T. Circle, Cawnpore, was entitled to re-open the assessment under Section 34 of the Act?"

( 2 ) THE facts are very simple and are not disputed. The assessee Subhkaran Seksaria entered into an agreement with Kedarnath, who carried on extensive business under the name and style of kedarnath Subhkaran, on 27th April 1940. Under this agreement the assessee undertook to secure contracts from the Government for Kedarnath Subhkaran and he was to be paid a remuneration of 5 per cent. on the value of the goods, which were supplied to the Government, besides the travelling expenses. The assessee received a sum of Rs. 36,586-2-6 during the previous year and in the assessment year 1941-42 he showed the said amount as his total income from business. The Income-tax Officer, however, on 29th July 1942, passed the following order:

"the total commission received and as entered in the accounts is Rs. 36,586 at 5 per cent, of the total value of the orders received. In view of my findings in the preceding paragraph, the assessees inco