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TMI Blog2000 (10) TMI 41X X X X Extracts X X X X X X X X Extracts X X X X ..... (irrebuttable) contained in Explanation I(A) and the presumption (rebuttable) contained in Explanation I(B), the Tribunal is right in law and fact in holding that the assessee cannot be said to have concealed the income or particulars of income ? 2. Whether, on the facts and in the circumstances of the case and also in the light of the findings in the assessment order confirmed by the Tribunal read with Explanation I, the Tribunal is right in law and fact in holding that the assessee cannot be said to have concealed the income or particulars of income ?" The assessee is a partnership firm carrying on abkari business. The assessment years in question are 1978-79, 1979-80 and 1980-81. There was a search conducted by the Department on May ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t looking at the documents will show that many entries in the documents do not relate to the assessee-firm. Further, it also took into account the assessment made in the name of Bhaskaran and Company wherein these statements have been relied on and the amount has been included in the income of Bhaskaran and Company. Thus, the penalty imposed was set aside by the Tribunal. It is in the above appeal, the questions of law have been referred to us. We heard learned counsel for the Revenue, Sri P. K. Ravindranatha Menon and learned counsel for the assessee, Sri P. Gopalakrishna Warriar. Sri P. K. Ravindranatha Menon submitted that during the assessment proceedings, on the basis of recovered material, viz., profit and loss account, the Tribunal ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... se from any fraud or any gross or wilful neglect on his part. The Explanation, thus, shifts the burden of proof to the assessee in the situation covered by it. Once the returned income is shown to be less than 80 per cent. of the total income assessed, the presumption comes into play and then the burden shifts to the assessee to establish that his failure to return the correct income was not on account of any fraud or gross or wilful neglect on his part. If he fails to establish the same, the presumption will become a finding and it would be open to the authority to levy the penalty. But if the assessee establishes that his failure to return the correct income was not on account of any fraud or any gross or wilful neglect on his part, it is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f us (Sankarasubban J.) has held that "Thus, going by the language in which Explanation I is couched, there will be a presumption in favour of the Department and against the assessee. Of course, it is only a rebuttable presumption". After hearing both sides, we are of the view that the matter requires fresh consideration at the hands of the Tribunal. According to us, the Tribunal could not have reinterpreted the profit and loss account and construed it as not relating to the assessee-firm. It is true that the assessee can prove that the amount included as income in the assessment proceedings is not actually an income of the assessee for the purpose of penalty proceedings and thereby he can avoid penalty. Construing the document, which was ..... X X X X Extracts X X X X X X X X Extracts X X X X
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