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TMI Blog2017 (3) TMI 1265X X X X Extracts X X X X X X X X Extracts X X X X ..... f the case are that in the course of regular assessment proceedings for the assessment year 1990-91, the Assessing Officer made additions of Rs. 2,39,000/- being cash credit entries found standing in the the assessee's books in the names of minor sons of the partners of the assessee firm. These were disbelieved to the extent the said minors were held to be in receipt of bogus gifts from complete strangers. Also, the Assessing Officer made addition on account of another cash credit appearing in the books of account of the assessee by way of loan of Rs. 50,000/- from one Sri Vikash Kumar Poddar. Upon appeal, in the quantum proceedings, the Tribunal confirmed the addition of Rs. 2,89,000/-. It has been stated by Sri Ashish Bansal that in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ch donors were friends of relatives and that the details of such friends of relatives who had made the gifts as an organized activity of the parents of the minors, who are the partners of the firm. Clearly, according to the CIT (Appeals) receipt of gifts from total strangers was a device to introduce unaccounted money in the names of minor children as well as in their own personal names. In further appeal the Tribunal again after considering the facts and circumstances of the case, observed and recorded its finding in the following terms:- "We have considered the rival submissions and perused the material on record. It has to be seen on the facts of the case whether Explanation 1 to Section 271(1)(c) is applicable. The facts have been el ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t the additions made in the assessment of the assessee represented the concealed income of the assessee within the meaning of Section 271(1)(c) of the Act and levy of penalty with reference to the same is justified in law and on facts? 3. Whether on the facts and circumstances of the case, which remained uncontroverted also, the Tribunal was legally correct in holding that the assessee had failed to discharge its onus that lied on it and accordingly it was liable for penalty under section 271(1)(c)? 4. Whether the view taken by the ITAT in the matter of leviability of penalty under section 271(1)(c) which are in the nature of quasi criminal proceedings, is not vitiated in law as the same has been arrived at without considering the relev ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ffers an explanation which is found by the [Assessing] Officer or the [***] [Commissioner (Appeals)] [or the [Principal Commissioner or] Commissioner] to be false, or." Upon appeal, the assessee appears to have offered an explanation which was considered and disbelieved by the CIT (Appeals) for reasons given by him which we have referred to above. Also, that authority noted as under : "As regards the creditors, Shri Vikash Kumar Poddar, provisions of Section 68 are squarely applicable as in that case the availability of cash to make the alleged loan has not been established. The contumacious conduct of the appellant introducing the impugned sums as alleged gifts to the minors or cash credit can be seen very clearly." The burden was on t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ot impressed by this submission either. We cannot loose sight of the fact that the minors in question were children of the partners in the firm and therefore, it had to be the partners who would have both arranged the gifts and also made the decisions to introduce money into the firm in name of the minors. It was therefore for them to have established the genuineness of the transaction as otherwise, in such circumstances, it would be to allow assessee's to place the minors in between themselves and the firm to escape the consequences in law by citing the rule - revenue cannot look into the source of the source. Further, in the facts of the instant case, the question of examining the source of the source may have been an issue in the qua ..... X X X X Extracts X X X X X X X X Extracts X X X X
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