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TMI Blog1986 (12) TMI 106X X X X Extracts X X X X X X X X Extracts X X X X ..... iage in 1975. He has further stated that he did not maintain any bank account and had a interest income from loans advanced to cultivators and maintained himself and his family out of money lending and agricultural income. No evidence whatsoever, was produced by the assessee in respect of gifts and presentations received by him at the time of marriage nor about the interest income and agricultural income and possession of any agricultural holding. The assessee has shown Rs. 15,000 in part III of the return stating that as it was capital to start the business, this was an exempt item. The assessee was heard also. He stated that he had no evidence to produce in support of the written explanation." 3. On appeal, the ld. AAC had cancelled the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... case of CIT vs. M. Habibullah (1982) 29 CTR (All) 281 : (1982) 136 ITT 716 (All) and Addl. CIT vs. Mangal Sen Mohanlal (1982) 31 CTR (All) 218 : (1982) 136 ITR 905 (All). In both the cases, His Lordship Mr. R.R. Rastogi expressed the opinion that the assessee was entitled to adduce further evidence in penalty proceedings and when no fresh evidence was adduced the onus on the assessee could not be said to have been discharged and in that circumstances levy of penalty should be treated as valid. 5. In response to notice of hearing, nobody appeared before us on behalf of the assessee. The appeal is, therefore, decided exparte and on merit and on the basis of the argument led by the ld. departmental representatives. 6. The relevant facts e ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of any explanation offered by such person, if such explanation is bona fide and all the facts relating to the same and material to the computation of his total income have been disclosed by him". It will be seen, in this explanation, there are saving clauses by which the assessee can-exonerate himself from penalty. Firstly, he can substantiate his explanation. Secondly, if the explanation is bona fide and all facts relating to the same and material to the computation of his total income have been disclosed by him. An explanation can only be treated as bona fide if it is made in good faith or genuinely. The story of genuinenity of the source had not been accepted by the AAC while deciding quantum appeal. Had he accepted the same he could n ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... The position may have to be reconsidered in the context of Expln. I to s. 271(1)(C) with has come into the statute with effect from April 1, 1976, in cases governed by it. This new Explanation might will be considered as being more than a rule of evidence as a rule of substantive law relating to penalty for concealment. The explanation is to the effect that where in the respect of any facts material or purposes of his assessment an assessee offers an explanation which is found by the ITO or the AAC to be false or where the assessee is unable to substantiate his explanation, then the amount added back in his assessment shall be deemed to represent his concealed income. Incidentally, it is a matter for comment that although the Tribunal may h ..... X X X X Extracts X X X X X X X X Extracts X X X X
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