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TMI Blog1980 (1) TMI 118X X X X Extracts X X X X X X X X Extracts X X X X ..... . 1,52,415. The ITO in the course of the assessment proceedings came across credits of Rs. 95,000 in the folio of the dairy farm. He found that no such income existed and if it existed it would have been utilised for the household expenses. It would appear that the Wealth tax returns filed by the partners did not show any surplus cash outside the books of account. Taking all these into consideration the ITO came to the conclusion that the credits could not be linked with the dairy income and in that view he treated the sum of Rs. 95,000 as income from undisclosed sources. The ITO also rejected the plea of the appellant that the credits formed the part of amounts disclosed by the appellant and the allied concerns. He also rejected the plea t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... has filed the present appeal. 3. Appearing for the appellant, Mr. Rahman has reiterated the arguments that were advanced before the AAC. For the purpose of the present case we are left with two credits on 2nd April, 1973 for Rs. 50,000 and on 1st Nov., 1973 for Rs. 45,000 which amount to Rs. 95,000 occurring in the accounting year relevant to the asst. yr. 1974-75. Thus the question now before us is as to whether the impugned amount of Rs. 95,000 could be taken to be coming out of the dairy income either of this year or the accumulated balance of the earlier years or the whether this income could be explained in any other plausible and convincing manner. In dealing with a matter of this magnitude, it is necessary to probe into the antec ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hen a cash credit entry appears in the assessee's books of account in an accounting year, the assessee has given some explanation, whether or not the burden has been shifted to the Revenue can only be determined after the evaluation of all the surrounding circumstances. There cannot be one general or universal propositions of law which could be the guiding yardstick in the matter. Each case has got to be decided in the facts and circumstances of that case. The surrounding circumstances to be considered must, however, be objective facts, evidence adduced before the taxing authorities, presumption of facts based on common human experience in life and reasonable conclusions. In holding a particular receipt as income from undisclosed sources, t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ks of the earlier firm and immediately this was debited in the name of the partners Shri Mashiuddin. Subsequently on 3rd Feb., 1973 the appellant's books, the same amount of Rs. 40,000 figured as the income from the dairy farm. In the circumstances this entry would refer only to the cash which figured on 2nd Jan., 1973 in the earlier concerns that was channelised through the partner Shri Mashiuddin. In such circumstances, the ITO did not treat the amount of Rs. 40,000 as an unexplained credit. In other words, he treated the sum of Rs. 40,000 as a genuine credit introduced in the books of the firm and it could easily be linked up with the income from the dairy farm. For the asst. yr. 1975-76 the amount of Rs. 40,000 credited in the books of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... icions, conjectures or surmises and if it does anything of the sort, its findings, even though on questions of facts, will be liable to be set aside by this Court." These observations are apposite to the facts of the present case. In Sreelekha Banerjee and others vs. CIT, Bihar and Orissa (2), the Supreme Court held that the Department cannot by merely rejecting unreasonably a good explanation convert good proof into no proof. This principle enunciated by the Supreme Court can also be applied to the facts of the present case. The matter may also be looked at from another angle. We have already referred to the facts that there was a raid at the residence of the partners on 27th Nov., 1974 and huge cash of Rs. 6,24,970 was found. The partn ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ubt to the appellant firm in the circumstances of the case as to the genuineness of the two credits of Rs. 50,000 and Rs. 45,000. In Rattan lal Others vs. ITO District V (I), New Delhi and Others (3), the Delhi High Court ruled that it was not permissible for the Department to go into the question of the nature and source of the amount declared in a Voluntary Disclosure Scheme and to say that it does not represent incomes of the declarant. If the declared amount becomes under the scheme the total income of the declarant for the purpose of charging income tax on it, it cannot be the income of some one else also for the same purpose of again charging income tax on it. To the same effect is the decision of the Jammu and Kashmir High Court in ..... X X X X Extracts X X X X X X X X Extracts X X X X
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