TMI Blog1979 (3) TMI 96X X X X Extracts X X X X X X X X Extracts X X X X ..... Rs. 33,153 equal to the amount of income alleged to have been concealed. It is from this order of the IAC that the present appeal is filed by the appellant. 3. Shri C.V. Mahalingam, the learned counsel for the appellant submitted that the appellant was a share-holder and Director in two companies namely M/s. Madras Radiators and Pressings Private Ltd., Coimbatore and M/s. Universal Radiators (P) Ltd., Coimbatore which were sister-concerns; that the appellant had sufficient amounts standing to his credit in the name of M/s. Universal Radiators Private Ltd.; that he had transferred Rs. 28,003 from his credit balance in M/s Universal Radiators (P) Ltd.; to his account in Madras Radiators and Pressings Pvt. Ltd., Coimbatore on 31st March, 1973 and that the appellant s account in M/s. Madras Radiators and Pressings Pvt. Ltd., showed a nil balance as on 31st March, 1973. Shri C.V. Mahalingam submitted that all the account copies were furnished by the appellant in the course of the assessment proceedings and it is on an examination of these account copies that the ITO arrived at the conclusion that the peak debit of Rs. 33,153 should be treated as dividend income in the hands of the ap ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... erial from the ITO. He also pointed out that in the form of return there was no provision for disclosing deemed dividends under s. 2(22)(e) of the Act. He relied on the decision of the Madras High Court in the case of V.S. Arulanandam vs. CIT(5). He however fairly stated that the Punjab and Haryana High Court has expressed a contrary view in the case of CIT vs. Aya Singh Ishar Singh(6) and in the case of CIT vs. Behari Lal Pyare Lal(7). The learned counsel finally submitted that the facts of the case clearly established that there was no intention or contumacious conduct on the part of the appellant to suppress his income from his return of income which would call for the levy of penalty even on its deemed income. 4. Miss R. Vijayalakshmi, the learned departmental representative vehemently opposed the contentions urged on behalf of the appellant. She pointed out that the appellant had filed his return of income on 29th Jan., 1974 that there were hearings on 3 dates subsequent to that and that the appellant filed these account copies in response to the ITO s enquiry on 9th Oct., 1975. She therefore submitted that the filing of these account copies was not voluntary. She next argue ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the meaning of the explanation to s. 271(1)(c). The order of the IAC levying the penalty clearly states that there was gross neglect on the part of the appellant in returning the correct income. We are unable to agree with the conclusion of the IAC since the materials on record do not justify such a conclusion. It may be that the assessee did not file the copy of accounts along with his return of income but that does not mean that the copies of accounts filed by him on 9th Oct., 1975 in response to the ITO's enquiry was not voluntarily filed by him. On the contrary this shows that the assessee had placed all the materials required by the ITO for making a proper assessment without withholding any of the relevant details from the ITO. 8. It was argued on behalf of the Revenue that since the assessee had knowledge of amounts standing to his credit in the two companies he should be held to have acted wilfully when he overdrew his account with M/s Madras Radiators and Pressings Private Ltd. It may be true that the assessee had knowledge of the amounts standing to his credit in these two companies but from this factor alone we are unable to draw an adverse inference against the assess ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e has to look merely at what is clearly said. There is no room for any intendment. There is no equity about a tax. There is no presumption as to a tax. Nothing is to be read in nothing is to be implied. One can only look fairly at the language used." Once it is shown that the case of the assessee comes within the letter of the law he must be taxed however great the hardship may appeal to the judicial mind to be. Again at pages 357-385 the Court observed as follows: "In other words even if the loan or advance ceases to be outstanding at the end of the previous year it can still be deemed as a "dividend" if the other four conditions factually exist to the extent of the accumulated profits possessed by the company. At the commencement of this judgment we have noticed some general principles one of which is that the previous year is the unit of time on which the assessment is based (s. 3.) As the taxability of an income is related to its receipt or accural in the previous year the moment a dividend is received whether it is actual dividend declared by the company or is a deemed dividend income taxable under the residuary head "income from other sources" arises. The charge being on ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tax under s. 2(6A)(e)of the Act was attracted at the time of payment by way of advance of loan, provided the other conditions were satisfied. We therefore hold that the explanation of the appellant that he had no intention to conceal the particulars of his income or to furnish inaccurate particulars thereof was quite probable and true in the state of the law set out above. We therefore held that on the preponderance of probabilities the appellant must be held to have discharged his onus of proof under the Expln. to s. 271(1)(c) of the Act and shown that there was no wilful or gross neglect on his part in returning the correct income. We are also satisfied that there was no intention on the part of the appellant to conceal the particulars of his income or to furnish inaccurate particulars thereof within the meaning of s. 271(1)(c) of the Act. On the contrary the materials on record clearly establish that the assessee had placed all the relevant particulars before the ITO for making a proper assessment. We are therefore satisfied that no penalty is exigible in the present case under s. 271(1)(c) of the Act. In this view it is unnecessary for us to consider whether there could be any ..... X X X X Extracts X X X X X X X X Extracts X X X X
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