9911796707
TMI Blog1985 (12) TMI 102X X X X Extracts X X X X X X X X Extracts X X X X ..... he residential premises of its managing partner Shri Bhagwat Saran. Besides certain other articles primary gold weighing 133.500 gms. valued at Rs. 6,000, new gold ornaments weighing 262.900 gms. valued at Rs. 10,204, new gold ornaments weighing 298.500 gms. valued at Rs. 11,509 and old ornaments weighing 39.310 gms. valued at Rs. 1,814, total Rs. 29,527 were seized by the custom authorities. The statement of Shri Bhagwat Saran was recorded by such authorities immediately after seizure of the said goods and he had stated that the said goods are meant for commercial purpose. The assessee had failed to explain the nature and source of the acquisition of the said articles and as such, addition under section 69 of the Act was made to the tune o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ecorded by the custom authorities and he had stated before them that the said gold and ornaments are meant for commercial purpose. In the books of account of the assessee there is no mention of the said gold or the ornaments. As such, a heavy burden lies on the assessee to prove that it did not conceal its income and it was for him to explain the source of acquisition of the said articles. We are unable to accept the contention of the learned counsel for the assessee that burden to prove concealment was on the department. Explanation 1 to section 271(1) reads as follows : "Explanation 1 : Where in respect of any facts material to the computation of the total income of any person under this Act,--- (A) such person fails to offer an expla ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . According to the assessee, the new gold ornaments weighing 262.900 gms. belonged to the womenfolk of the house of Shri Bhagwat Saran. The family of Shri Bhagwat Saran consisted of his two sons and wives and the wife of Shri Bhagwat Saran and his mother. The explanation of the assessee on the point was not accepted by the ITO and we feel rightly, because at the time of search 1339 gms. of gold ornaments were found in a bank locker and they were held to be belonging to the family of Shri Bhagwat Saran. Moreover, at the time of search, Shri Bhagwat Saran did not claim that the said ornaments belonged to the womenfolk of his family. 7. As regards the gold ornaments weighing 298.500 gms. and 39.300 gms., it was urged on behalf of the assesse ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ster, in our opinion, has little evidenciary value and much significance cannot be attached to it, because the same has not been certified or countersigned by any competent authority. 9. The explanation of the assessee as regards primary gold weighing 133.500 gms. that the wife of Shri Bhagwat Saran gave her ornaments to the goldsmith Shri Satya Prakash for manufacturing new ornaments because a son of Shri Bhagwat Saran was going to be married shortly and thereafter Shri Satya Prakash had melted the old ornaments. It was also contended that all of a sudden Shri Satya Prakash had to go out and therefore, he had left the melted gold with the wife of Shri Bhagwat Saran. This contention also does not appear to be sound. As already observed ab ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sistance to the assessee. In the instant case, the order imposing the penalty passed by the ITO is not based on the orders passed by the customs authorities or on the order passed in the assessment proceedings. His order is based on his independent findings. Reference to the orders of the custom authorities and the assessment proceedings has been made only incidentally. It would be appropriate to mention here that order passed in such proceedings have a probative value and they can be looked into for incidental purposes. 12. It was also argued on behalf of the assessee that Shri Bhagwat Saran had made his statement before the custom authorities under duress and coercion and, therefore, the ITO should not have placed any reliance on the sa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... raw the said admission successfully and from the circumstances available on record it could not be proved that the same is erroneous. 13. It was also contended on behalf of the assessee that other partners of the firm are not bound by the statement made by Shri Bhagwat Saran. We find no force in this argument as well. It is not in dispute that Shri Bhagwat Saran was a partner of the assessee-firm. It is well settled that a partner is an agent of the firm and the acts of a partner are binding on the firm. 14. The learned counsel for the assessee has also argued that the ITO did not examine the assessee or any of the goldsmiths and without examining them he was not entitled to reject the written submissions which had been submitted by the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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