TMI Blog2002 (8) TMI 97X X X X Extracts X X X X X X X X Extracts X X X X ..... n nature, in the facts of this case, the onus on the Revenue has been duly discharged. - the question involved herein is answered in the negative, i.e., in favour of the Revenue and against the assessee. - - - - - Dated:- 16-8-2002 - Judge(s) : S. B. SINHA., A. K. SIKRI. JUDGMENT The judgment of the court was delivered by S. B. SINHA C. J. -At the instance of the Revenue, the Income-tax Appellate Tribunal, Delhi Bench "C", New Delhi (hereinafter for the sake of brevity referred to as, "the Tribunal"), has sent the statement of the case to this court for its opinion in terms of section 256(2) of' the Income-tax Act, 1961 (hereinafter for the sake of brevity referred to as, "the said Act"), on the following question: "1. Whether, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dings. The learned Tribunal was of the opinion that the addition of Rs. 19,000 was rightly made in terms of section 69A purported to be on the difference in the closing stock found to have been shown in the two inventories, one seized in the course of the raid and the other produced by the assessee. It was observed: "8... In other words, there is no material on record that the discrepancy was on account of the income for the assessment year under appeal, and merely because the addition was made under section 69A, no penalty is exigible. Even otherwise we are of the view that the assessee gave an explanation and the explanation was supported by the statements of Raja Durga Singh of Solan and a partner of the assessee-firm. It is true that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... re and source of acquisition of the money, bullion, jewellery or other valuable article, or the explanation offered by him is not, in the opinion of the Assessing Officer, satisfactory, the money and the value of the bullion, jewellery or other valuable article may be deemed to be the income of the assessee for such financial year." The apex court in Mussadilal Ram Bharose's case [1987] 165 ITR 14 observed that the burden placed upon the assessee is not discharged by any fantastic explanation. Nor is it the law that any and every explanation by the assessee must be accepted. The explanation must be found to be acceptable by the fact finding body. It was held: "The position, therefore, in law is clear. If the returned income is less tha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t in dispute constitutes income of the assessee and that the assessee has concealed the particulars of his income or deliberately furnished inaccurate particulars of such income. If there is no evidence on 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. (c) The finding recorded in the assessment proceedings that a particular receipt is his income after rejecting the explanation given by the assessee as false, would [not?] prima facie be sufficient for establishing in proceedings under section 28 that the disputed amount was the assessee's income. The finding recorded in the assessment proceedings may be good evidence but ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed in clause (c), but the Explanation aforestated was added. The Explanation creates a presumption of law-which is no doubt rebuttable. The presumption of law created by the Explanation is to the following effect: where the total income returned by any person is less than 80 percent of his total assessed income, such person shall be deemed to have concealed the particulars of his income or furnished inaccurate particulars of such income for the purposes of clause (c) unless he proves that the failure to return the correct income did not arise from any fraud or any gross or wilful neglect on his part. The Explanation, thus, shifts the burden of proof to the assessee in the situation covered by it. Once the returned income is shown to be less ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... h came in or resulted in gain. It was held: "As regards the second question, the Explanation to section 271(1)(c) of the Act was inserted by the Finance Act, 1964, which reads as follows: 'Explanation, -Where the total income returned by any person is less than eighty percent of the total income (hereinafter in this Explanation referred to as the correct income) as assessed under section 143 or section 144 or section 147 (reduced by the expenditure incurred bona fide by him for the purpose of making or earning any income included in the total income but which has been disallowed as a deduction), such person shall, unless he proves that the failure to return the correct income did not arise from any fraud or any gross or wilful neglect o ..... X X X X Extracts X X X X X X X X Extracts X X X X
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