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1 - 10 of 31 (0.44 seconds)Section 69A in The Income Tax Act, 1961 [Entire Act]
Section 274 in The Income Tax Act, 1961 [Entire Act]
Commissioner Of Income-Tax, ... vs Vinaychand Harilal on 17 October, 1978
9. The arguments of the Departmental Representative were to the following effect :-- The proviso to Explanation 1 applies only when the assessee's case falls under Clause (B) of the said Explanation. But in the present case, the assessee's case comes under Clause (A). The Assessing Officer has mentioned Explanation 1 in his penalty order dated March 10, 1986. He is not bound to mention the Explanation in the assessment order or in the penalty notice issued under Section 271 read with Section 274 of the Income-tax Act, 1961. Since the offence is covered by the main section itself, ,the ratio of the judgment in the case of Anwar Ali [1970] 76 ITR 696 is not applicable. Further the ratio laid down in the case of CIT v. Vinaychand Harilal [1979] 120 ITR 752 (Guj) is not applicable as the addition was made under Section 69, but applies only to the addition made under Section 69A. Penalty can be. levied under Section 271(1)(c) where there was no satisfactory explanation regarding the investment and the unexplained amount was added under Section 69.
Section 131 in The Income Tax Act, 1961 [Entire Act]
Section 271 in The Income Tax Act, 1961 [Entire Act]
Sir Shadilal Sugar & General Mills Ltd. vs Commissioner Of Income-Tax on 30 April, 1982
The assessee relies on the judgments of the Supreme Court in the cases of CIT v. Anwar Ali [1970] 76 ITR 696 ; CIT v. N. A. Mohamed Haneef [1972] 83 ITR 215 ; CIT v. Khoday Eswarsa and Sons [1972] 83 ITR 369 and Sir Shadilal Sugar and General Mills Ltd. v. CIT [1987] 168 ITR 705. Even if it is assumed that the Assessing Officer can invoke Explanation 1 directly in the penalty order, the above decisions still hold good as the presumption laid down by the Explanation has been rebutted by the appellant on the basis of the balance of probability. Once the initial burden cast on the assessee as per the Explanation was discharged, the burden will shift to the Department to prove that the explanation offered was false. In the case of CITv. Mussadilal Ram Bharose [1987] 165 ITR 14, the Supreme Court has held that, where the circumstances do not lead to the reasonable and positive inference that the assessee's explanation is false, the assessee must be held to have proved that there was no fraud or gross or wilful neglect on his part.
Commissioner Of Income-Tax, Madras vs K.R. Sadayappan on 10 July, 1990
In the case of CIT v. K. R. Sadayappan [1990] 185 ITR 49, the Supreme Court held that the onus was rebuttable; the presumption of concealment was rebutta-ble by cogent, reliable and relevant material.
Commissioner Of Income-Tax vs Nathulal Agarwala And Sons on 12 March, 1985
It has been held in the cases of CIT v. Nathulal Agarwala and Sons [1985] 153 ITR 292 (Patna) [FB] and Vishwakarma Industries v. CIT [1982] 135 ITR 652 (P & H) [FB] that the onus of proof for rebutting the presumptions lies squarely on the assessee. However, the burden can be discharged, as in civil cases, by preponderance of evidence and it would be permissible in the penalty proceedings for the assessee to show and prove that on the existing material itself, the presumptions raised by the Explanation stands rebutted. The Gujarat High Court in the case of CITv. S. P. Bhatt [1974] 97 ITR 440 held that the legal fiction could be displaced if the assessee proved that the failure to return the correct income did not arise from any fraud or gross or wilful neglect on his part. If the assessee could do that, he could thereby throw the burden of bringing the case within Section 271(1)(c) again on the Revenue.
Commissioner Of Income-Tax vs Saraf Trading Corporation on 8 June, 1987
The judgment of the Kerala High Court in the case of CIT v. Saraf Trading Corporation [1987] 167 ITR 909 is also in favour of the assessee. Assuming that the assessee's case falls within Explanation 1, inserted with effect from April 1, 1976, the assessee's case is covered by the proviso which was deleted from September 10, 1986. The assessee filed the return of income on July 4, 1983, and so the law that would be applicable is the law that was prevailing at that time, i.e., before the amendment made
from September 10, 1986. The assessee submitted the explanation to the effect that there was no direct or indirect evidence with the Department so as to hold that the assessee had made any initial investment in goods covered by the alleged bills found and seized in the course of the search. It was submitted that, as in the case of United Brothers, similar addition on substantive basis was made by the Assessing Officer vide assessment order passed on March 31, 1986, which has become final as United Brothers accepted the addition by filing the revised return on the same day on March 31, 1986, and paying additional tax, no addition in the case of the assessee could be sustained on the ground of double taxation. The Accountant Member, who differed against the deletion of the addition has accepted that the addition can be sustained only on the basis of surrounding circumstances. The fact that the two learned Members differed on the point of addition suggests that the explanation furnished by the assessee was bona fide. The explanation offered by the assessee is not false although the assessee might be treated as not being able to substantiate its explanation. So the case of the assessee at best would fall under Explanation 1(B) and not Explanation 1(A). In this case, the assessee is saved by the proviso to Explanation 1 as all the material facts for computation of the total income were disclosed by the assessee and the explanation was bona fide. In the present case, there is no material on record to come to the conclusion that the explanation furnished by the assessee was false. The assessee's explanation may be treated as unproved but the same has not to be disproved and the circumstances do not lead to the reasonable and positive inference that the assessee's case is false, there being no material on record to show that the amount in question which has been treated as income from undisclosed sources, was the income of the assessee. The mere fact that the assessee's explanation had not been found to be satisfactory would not be conclusive of the fact that the assessee's explanation was false. Considering the totality of the present circumstances of the case and evidence on record, Explanation 1(A) is inapplicable. Whereas for the purpose of Section 69, substantiating the explanation is to the satisfaction of the Assessing Officer, for the purpose of application of Explanation 1(B) to Section 271(1)(c), one has to consider the explanation furnished by the assessee so as to come to the conclusion whether the evidence furnished by the assessee creates a belief in favour of the assessee. If it is found that the evidence produced creates a belief in favour of the assessee, then in penalty proceedings, the benefit of doubt has to be given to the assessee.