9911796707
TMI Blog1994 (7) TMI 17X X X X Extracts X X X X X X X X Extracts X X X X ..... 1970-71 was the first assessment year in relation to the respondent-assessee. It appears that he had not filed the return but, since he was a dealer in cement and fertilizer and also a money-lender a notice under section 148 of the Act was issued pursuant to which he filed his return showing an income of Rs. 384 only. During the enquiry, the Income-tax Officer found that the assessee has advanced Rs. 37,000 on two occasions to one N. Doraisamy Reddiar and interest of Rs. 6,300 was also shown credited in the account of the said Reddiar. When this was put to the assessee by the Income-tax Officer, he has stated that the money was that of his mother-in-law and he acted only as a name-lender. The Income-tax Officer after making enquiries into t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... v. Jewels Paradise [1975] 101 ITR 265 (Kar), the Tribunal, therefore, held that penalty could not be imposed in relation to the income so assessed. As regards applicability of the Explanation to section 271(1)(c) of the Act, the learned Member of the Tribunal accepted the explanation of the assessee and held that the preponderance of probability clearly established that the failure to return the total assessed income was not because of fraud or gross or wilful neglect on the part of the assessee. That is how the penalty was set aside. The Department seems to have asked for a reference, which has been granted. The submission of learned counsel for the Revenue is that the Tribunal has acted illegally and without jurisdiction in accepting the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r where the Tribunal draws upon its own imagination and imports facts and circumstances not apparent from the record or bases its conclusion on mere conjectures or surmises or where no person judicially acting and properly instructed in law would have come to the said finding. Those observations were made in relation to assessment proceedings and not in relation to penalty proceedings and that by itself would be a good ground for not applying those observations to a penalty proceeding. Assuming, however, that these observations are relevant in relation to a penalty proceeding and we have the jurisdiction to interfere with the finding recorded by the Appellate Tribunal we would find no justification for the same in view of the facts and circ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d by the assessee by giving his own statement. It cannot be accepted as a good proposition of law that the statement of the assessee should never be accepted as a good explanation. The conclusion would, of course, differ from case to case. There may be cases in which his statements may not be found sufficient to discharge the burden placed on him. In the instant case, however, his statement had been found acceptable to the Tribunal which is the final authority of fact and we do not have the appeal power over its conclusion. Under the circumstances, it is the considered view of this court that no part of the law contained in the Explanation to section 271(1)(c) remains violated in the instant case. In view of the discussion aforesaid, the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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