9911796707
TMI Blog1992 (6) TMI 161X X X X Extracts X X X X X X X X Extracts X X X X ..... age Behbalpur, Tehsil Garhshankar, District Hoshiarpur. As per revenue records, this land bears Khata No. 29/ 61, Khasra Nos. 25/21, 26/16 and 25. Shri Ajaib Singh (ii) House No. 1, Street C-3, Site B, Vasant Vihar, New Delhi. Shri Ajaib Singh (iii) Compensation received from Punjab Government in lieu of 116 kanals of agricultural land in village Sabowal, Tehsil and District Jalandhar, bearing khata No. 12/15, khasra Nos. 186/16, 189/22, 23/24, 192/25, 195/31, 32 to 38, 198/39 and 81 to 85 acquired by the State Government. The appellant, vide his reply dated February 11, 1981 (wrongly typed as July 11, 1981, in the impugned order of the Competent Authority under section 7(1) of the Act), stated that his only source of income was from agricultural land. He was an income-tax assessee with the Income-tax Officer, Special Circle, Jallandhar. Agricultural land measuring 2K-3M was purchased by his father, late Shri Lakha Singh, and brother, late Shri Mohan Singh, in the year 1970, for Rs. 3,180 and was gifted to him. The property at Vasant Vihar, New Delhi, was acquired through an agreement entered into with Miss Ivy Raymond, and he spent Rs. 1,36,000 on it. The agricultural land measu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... credit of varying amounts ranging between Rs. 58,000 and Rs. 2,15,000 (in round figures) per year for sale of agricultural produce. These receipts are also not supported by any documentary evidence. The Competent Authority, after examining the explanation of the appellant regarding the source of investment and also after taking into account the statements of assets and liabilities for the different years, came to the conclusion that the sources of acquisition of land measuring 2K-2M item No. (i) stands properly explained. However, as regards items Nos. (ii) and (iii), viz., the house property in Vasant Vihar, New Delhi, and the land measuring 116 kanals, the Competent Authority held that investment made by the appellant emanated from the profits of illegal activities since the explanations offered by the appellant from time to time linking the acquisition of these assets with his known sources of income were not properly substantiated by supporting evidence and, therefore, could not be accepted. He, therefore, vide order dated November 11, 1990, directed forfeiture of the following properties : (i) House No. 1, Street C-3, Site B, Vasant Vihar, New Delhi. (ii) Compensation of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... taking credit of remittance of Rs. 3,50,000 from the U. K. on February 20, 1970, and loans from different agriculturists Rs. 2,36,300 for the year ending on March 31, 1971, as also advances to the tune of Rs. 77,264 described as sundry creditors in the year ending on March 31, 1972. Besides these items, credit of varying amounts varying between Rs. 58,000 and Rs. 2,15,000 have been taken as sale proceeds of agricultural produce from agricultural land cultivated by the appellant. None of these items of credit can be held to have been available to the appellant for making investments for acquiring forfeited properties for the reasons appended below : (i) The credit of Rs. 3,50,000 in the bank account of the appellant on February 20, 1970, has been examined by the Tribunal in the appellant's brother's case (Chatar Singh v. Competent Authority [1990] 186 ITR 83 (ATFP), F.P.A. No. 26/DLI/90, decided on July 23, 1990) and again in the appellant's wife's case (Smt. Rajinder Kaur v. Competent Authority F.P.A. No. 27/DLI/91, decided on December 19, 1991). The Tribunal, after detailed investigation of the facts, came to the conclusion that the amount of Rs. 3,50,000 admittedly sent by the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... appellant to produce the creditors, who have advanced interest-free loans for cross-examination but none of the creditors was actually produced before the Competent Authority nor was any other evidence produced to establish their financial capability. A perusal of the income-tax records of the appellant for the assessment years 1971-72 and 1972-73 also shows that only three of the creditors, viz., Shri Malkiat Singh, Shri Om Prakash Senota and Shri Jagdev Singh, were produced before the Income-tax Officer on December 17, 1988. The statements recorded by the Income-tax Officer also did not give details of their landholdings, bank accounts or other evidence to show that their savings from agriculture were available to them for being advanced to the appellant. In fact, all the three creditors who were produced denied having any bank account and only stated that the amounts were advanced by them out of their home chest from their agricultural savings. No details of the extent of agricultural holdings and their income were given. Out of the remaining creditors, letters from the village Sarpanch were filed in five cases stating that the concerned persons had expired prior to the hearing ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... agricultural produce. The case of the appellant is that he had taken agricultural land on lease from various parties and the income from such land was utilised for acquiring the forfeited properties. No details of the agricultural lands allegedly taken on lease by the appellant has been supplied. The names of the lessors, the quantum of land taken on lease or the lease amount are conspicuously absent. No copy from the revenue records has been produced to prove the factum of lease. No account books whatsoever have been maintained in respect of agricultural income nor has any account of expenses incurred on cultivation, viz., labour, seeds, fertilisers, water and electricity charges, etc., been maintained. The figures in arhitias books can at best be taken as gross sale of some agricultural produce and cannot be treated as net income of the appellant. The amounts deducted from gross receipts to arrive at the net accretion of the capital in the balance-sheet filed by the assessee are purely in the nature of conjectures and no basis whatsoever has been indicated to arrive at the net income from agriculture. The household expenses of Rs. 5,000 to Rs. 10,000 per year which have been sho ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... w before taking any action against him under the Act. This argument of the appellant's learned counsel is neither here nor there. The proceedings against the appellant were started by the Competent Authority not because of his personal involvement in any nefarious activities but because he fell into the category of a relative of Pakhar Singh against whom a detention order was made under the COFEPOSA Act, 1974. It is immaterial that the detention order, though made, was not served on Shri Pakhar Singh. The mere making of a detention order renders his relatives falling under section 2(2)(c) of the Act liable under the provisions of this Act which have been rightly evoked in this case. (ii) It is contended that the findings under the income-tax proceedings for the relevant assessment years regarding the sources of investment in the two forfeited properties should not have been ignored lightly by the Competent Authority. The Tribunal has already dealt with this aspect in Lallubhai Durlabhbhai v. Competent Authority (F.P.A. No. 12/ ABD/91 [1991] 191 ITR 627), wherein it has been held that the findings of the income-tax authorities cannot always be treated as conclusive in proceedings fo ..... X X X X Extracts X X X X X X X X Extracts X X X X
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