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TMI Blog1975 (7) TMI 57X X X X Extracts X X X X X X X X Extracts X X X X ..... of account of the assessee found a sum of Rs. 25,000, credited on September 13, 1962, to the account of Khubram Mansing of 36, Ezra Street, Calcutta. The assessee was asked to prove that the credit in favour of M/s. Khubram Mansing was genuine. No evidence was produced except an undated receipt from the party which purported to state that the sum in question was advanced by the creditor and received back by it. The Income-tax Officer rejected that explanation and stated that he had evidence that the loan standing in the creditor's name was not genuine. Accordingly, the Income-tax Officer included the sum of Rs. 25,000 as income of the assessee under the head "Other sources" and made the assessment. The assessee preferred an appeal before t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... able, and the evidence given by it was not enough to prove the genuineness of the credit, it could not be held that a case of concealment was made out. The Tribunal also found that there was no evidence led by the department to prove that the assessee had concealed its income. On an application under section 256(1) of the Act, the Tribunal observed that since the order wag passed on the facts that there was no material to prove the concealment from the side of the department, the matter was clearly decided as a question of fact and no question of law arose. Thus, the Tribunal declined to refer the proposed question of law. Hence, the present petition. The question of law on which the Commissioner of Income-tax prays for calling for a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of penalty is in the nature of a penal provision. The determination of the question of burden of proof will depend largely on the penalty proceedings being penal in nature or being merely meant for imposition of an additional tax, the liability to pay such tax having been designated as penalty under section 28. One line of argument which has prevailed particularly with the Allahabad High Court in Lal Chand Gopal Das's case is that there was no essential difference between tax and penalty because the liability for the payment of both was imposed as a part of the machinery of assessment and the penalty was merely an additional tax imposed in certain circumstances on account of the assessee's conduct. The justification of this view was founde ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tax v. Gokuldas Harivallabhdas the gist of the offence under section 28(1)(c) is that the assessee has concealed the particulars of his income or deliberately furnished inaccurate particulars of such income and, therefore, the department must establish that the receipt of the amount in dispute constitutes income of the assessee. If there is no evidence on the record except the explanation given by the assessee, which explanation has been found to be false, it does not follow that the receipt constitutes his taxable income. Another point is whether a finding given in the assessment proceedings that a particular receipt is income after rejecting the explanation given by the assessee as false would, prima facie, be sufficient for establishi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ng penalty cogent material or evidence from which it could be inferred that the assessee has consciously concealed the particulars of his income or had, deliberately furnished inaccurate particulars in respect of the same and that the disputed amount is a revenue receipt. No doubt the original assessment proceedings for computing the tax may be a good item of evidence in the penalty proceedings but the penalty cannot be levied solely on the basis of the reasons given in the original order of assessment." In the instant case, it is found and the Tribunal also has found that, except that the explanation regarding the entry of a sum of Rs. 25,000 in the books of account in the name of M/s. Khubram Mansing was rejected by the Income-tax Offi ..... X X X X Extracts X X X X X X X X Extracts X X X X
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