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TMI Blog1993 (3) TMI 158X X X X Extracts X X X X X X X X Extracts X X X X ..... of Shri Mukesh Kumar, the Assessing Officer held that sum of Rs. 24,840 remained unexplained investment and added the same in the hands of the assessee with the following observations :--- " It was deposed by Shri Mukesh Kumar that his only source of income is of commission, which he received for the supply of building material from the dealers to the customer. That his monthly income from this source was only Rs. 700 to 900 per month, it was also deposed that he is an unmarried individual having no rented house and living in a shop near a school which belongs to some person and he is living with the help of Doctor Veer Sen, resident of Dabri, Distt. Bulandshahr. On questioning whether he owns any immovable property, it was replied by him that he owns only one shop situated at Shahdara in the co-ownership of Shri Amar Nath r/o Debir, Distt. Bulandshahr. That he got 1/2 share in the shop and this shop was stated to have been purchases about 21 /2 years ago for a sum of Rs. 15,000. That he has invested a sum of Rs. 7,500 out of his savings from his income of Rs. 800 or 900 per month. It was also deposed by him that except this, he does not own any immovable property. But, on furthe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... re plot of land measuring 420 sq. yds. belongs to Shri Jawahar Lal, karta of HUF and he had himself got constructed the godown and in order to explain the nature and source of investment made on it, he had taken the help of Shri Mukesh Kumar who is not in a position to help him entirely. In this way, the investment stated to have been made by Shri Jawahar Lal was property explained but so far as the investment of Shri Mukesh Kumar is concerned, that was not explained satisfactorily and as legally plot of land cannot be held is treated to have been made by Shri Jawahar Lal, karta of the HUF. It can only be admitted that the sum of Rs. 15,000 and further Rs. 5,000 can be treated as loan from Shri Mukesh Kumar to Shri Jawahar Lal, karta of the HUF. In this way, Shri Jawahar Lal is able to explain the nature and source of Rs. 35,000. Further Rs. 5,000 which he had taken from the balance of Rs. 24,840 remains unexplained investment which will be added in the total income of the assessee as income from undisclosed sources. " The addition made by the Assessing Officer was confirmed an further appeal by the learned CIT (Appeals) and ultimately by the Tribunal. The Hon'ble Allahabad High ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... assessment proceedings. It is necessary for the revenue authorities to reappraise the material and then arrive at a finding in penalty proceedings relating to concealment of income. Of course assessment order and addition of income would have the effect of shifting burden of proof depending upon Explanation to section 271(1)(c) as applicable in the relevant assessment year. In the assessment year 1980-81 with which I am concerned, proviso to Explanation 1 introduced with effect from1-4-1976was applicable. The gist of the proviso was that no penalty should be levied in respect of any amount added or disallowed if explanation furnished by the assessee is bona fide and all the facts relating to the same and material to the computation of his total income have been disclosed by the assessee. In the light of a statutory provision I proceed to examine the facts of the case. 6. In support of the claim that 1/2 amount in the construction was contributed by Shri Mukesh Kumar who further gave Rs. 15,000 to the assessee towards 50% of price of land, the assessee relied upon agreement dated 2-8-1979. As per clause 3 of the said agreement, that both the parties were to construct jointly a god ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dri. I have got 1/2 share in the shop. This shop was purchased by me 2 1/2 years back for Rs. 15,000. My investment in this property is Rs. 7,500. The investment in this property was made by me out of my savings of monthly income of Rs. 900. I have saved Rs. 500 each month and the balance amount of salary was used for my messing charges of hotel etc. Except this, I do not own any immovable property in my own name or in the co-ownership of anybody else. Q. No. 4. Have you made any agreement for the purchase of plot of land measuring 420 sq. yds. in the co-ownership of Shri Jawahar Lal Goyal, Advocate, s/o Shri Amolak Chand, resident of Gulaute, District Bulandshahr. Ans. Yes. I did enter into an agreement with Shri Jawahar Lal, s/o Shri Amolak Chand to purchase the 1/2 share of plot of land measuring 420 sq.yds. in the month of Aug. 79. This agreement was made for a sum of Rs. 15,000 for 210 sq. yds. of plot of land. The amount of Rs. 15,000 was paid to Shri Jawahar Lal, Advocate by taking loan from Shri Har Kishan Lal s/o not known, r/o Akbarpur Roni, District : Bulandshahr Rs. 20,000. I can file evidence to this effect. Thereafter, the registration of plot was never made in my ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... how he could save Rs. 27,000 from his earnings. It would not be reasonable to except the answer to the above question from the assessee as he is not expected to establish source of a source. If examination of Shri Mukesh Kumar is objectively considered it is clear that Assessing Officer at the time of examination accepted answer given by the deponent to question No. 5 as next question No. 6 asked by him is on a different subject altogether. He did not doubt or challenge the answer given to question No. 5. It would have been fair and proper to ask Shri Mukesh Kumar to explain how he could save Rs. 27,000 from his income before drawing adverse conclusion which was ultimately drawn. In answer to question No. 8 Shri Mukesh Kumar gave details of rent received in 1980-81. From the above and from answer to question No. 1 it would not be unreasonable to infer that Shri Mukesh Kumar's answer to question No. 1 related to sources of income in 1986 when his statement was recorded by the Assessing Officer and not to earlier years. On the aforesaid circumstances I find it difficult to conclude that assessee can be said to have concealed his income from purposes of section 271(1)(c) of Income-ta ..... X X X X Extracts X X X X X X X X Extracts X X X X
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