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TaxTMI 
TaxTMI 
TaxTMI 
1975 (12) TMI 29
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.... notes kept in two boxes which were buried in the earth in an open place in the house. On information relating to the discovery of this amount and the admission by the assessee that the money belonged to him, the Income-tax Officer started assessment proceedings invoking his power under section 175 of the Act. He issued a notice under section 139(2) on January 11, 1965. In response to this notice, the assessee filed a return on January 19, 1965, admitting an income of Rs. 5,000 under the head of " Property income ". With reference to the sum of Rs. 1,70,000, it was explained on behalf of the assessee that he and his two sons were carrying on business in Ceylon for a number of years and that the said money represented the amounts saved by th....
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....s payable within ten days from the date of service of the demand notice. Since the tax was not paid, as demanded, within the time allowed, a show-cause notice was issued by the Income-tax Officer under section 221 of the Act and ultimately imposed a penalty of Rs. 6,400 equivalent to 5 per cent. of the tax. The assessee preferred appeals to the Appellate Assistant Commissioner against the assessment order and the penalty levied under section 221. The Appellate Assistant Commissioner confirmed the finding of the Income-tax Officer that the explanation of the assessee was not acceptable and that the sum of Rs. 1,70,000 was the income of the assessee from undisclosed sources. Accordingly, he confirmed the assessment and dismissed the appeal. H....
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....ittance, it would not be fair to expect any evidence of such remittances as they would be in the nature of clandestine remittances. The Tribunal also pointed out that if as large an amount of Rs. 1,70,000 is to be earned in the normal course of business, it would require a large amount of capital and there is no evidence of investment of such capital in India by the assessee. On these reasonings, the Tribunal held that there was no material for them to hold that the amount in question represented the income of the assessee. On this finding the Tribunal set aside the order of assessment. Consequently, the appeals filed by the assessee against the penalty order under section 271(1)(c) and section 221 were also allowed and the appeal filed by ....
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....unt in question represented the income of the assessee was based on assumptions and presumptions and not on any legal evidence. He also contended that the Income-tax Officer and the Appellate Assistant Commissioner specifically relied on section 69A and, in fact, the Tribunal also held that section 69A was applicable, and in view of the provisions contained in that section the Income- tax Officer was right in drawing the inference that the sum of Rs. 1,70,000 represented the income of the assessee. On the other hand, the learned counsel for the assessee contended that the onus of proof under section 69A does not rest with the assessee throughout the proceedings and when he lets in certain evidence, the burden shifts to the department to pro....
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....lon or that the sum of Rs. 1,70,000 represented the income from any business carried on by the assessee in India. The explanation of the assessee, to say the least, had not been supported by any evidence, and the rejection of the explanation by the Income-tax Officer was, therefore, absolutely proper. The entire order of the Tribunal is vitiated by the fact that the finding is reached only by presumptions and assumptions and not on any relevant evidence or circumstance. Though we might have considered the question as to whether the mere rejection of the explanation of the assessee could lead to a presumption that the amount represented income of the assessee, if there was some evidence or a possible inference that the amount could have been....