TMI Blog1960 (11) TMI 126X X X X Extracts X X X X X X X X Extracts X X X X ..... ies. But the assessee did not produce any evidence before the Income-tax Officer to substantiate the contention. In the absence of any satisfactory explanation with regard to the source of the cash credit, the Income-tax Officer held that the amount should be included for the purpose of income-tax in the total income of the assessee. The assessee preferred an appeal before the Income-tax Appellate Commissioner, but the appeal was dismissed. The assessee again took the matter in appeal before the Income-tax Appellate Tribunal, which reduced the addition to a sum of ₹ 15,941, after taking into consideration certain withdrawals in the same account. On November 30,1948, a notice was issued under section 28(3) of the Indian Income-tax Act, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r Sri V. Jha, on June 9, 1955. The argument of learned counsel is that Sri V. Jha, successor-in-office of Sri K.P. Kumar, had no authority to impose this penalty unless a fresh notice was issued by Sri V. Jha and fresh explanation was called for from the assessee. We do not think there is any substance in this argument. Section 28(1) of the Indian Income- tax Act is in the following terms: 28 Penalty for concealment of income or improper distribution of profits.--(1) If the Income-tax Officer the Appellate Assistant Commissioner or the Appellate Tribunal in the course of any proceedings under this Act is satisfied that any person-- (a) has without reasonable cause failed to furnish the return of his total income which he was requi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion and is succeeded by another who has and exercises jurisdiction, the income-tax authority so succeeding may continue the proceeding from the stage of which the proceeding was left by his predecessor: Provided that the assessee concerned may demand that before the proceeding is so continued the previous proceeding or any part thereof be reopened of that before any order for assessment is passed against him he be re-heard: Provided further that in computing the period of limitation for the purpose of sub-section (3) of section 34, the time taken in reopening the whole or any part of the proceeding or in giving an opportunity to the assessee to be re-heard under the proceeding proviso shall be excluded. Reading, therefore, se ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Tanneries (1944) Ltd. v. Commissioner of Income-tax [1960] 40 I.T.R. 178. It was held in that case that the succeeding officer under section 5(7C) of the Income-tax Act had no authority to pass an order of penalty without giving the assessee a further opportunity of advancing arguments before him. With great respect we differ from the view expressed by Calcutta High Court in this case. In our opinion, the combined effect of section 28(3) and section 5(7C) of the Indian Income-tax Act is that the succeeding Income-tax Officer had authority to pass an order upon the explanation of the assessee produced before his predecessor-in-officer, if the assessee had proexercise his right under section 5(7C) demanding that the preceding should be reope ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t able to establish by satisfactory evidence the source of the income did not mean that the explanation was false or that the assessee had been guilty of deliberate suppression within the meaning of section 28(1)(C). In our opinion the ratio of his case cannot be applied to the present case, because the material facts are quite different. In Khemraj Chagganlal v. Commissioner of Income-tax the question was with regard to the income stand in the assessee's books in the name of Srimati Purnima Devi. The explanation of the assessee was that the money belonged to Shrimati Purnima Devi and the money represented the sale proceeds of gold ornaments. In that case the account books of the assessee showed the amount in the name of Srimati Purnima ..... X X X X Extracts X X X X X X X X Extracts X X X X
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