9911796707
TMI Blog1998 (12) TMI 80X X X X Extracts X X X X X X X X Extracts X X X X ..... us year relevant to the assessment year 1972-73, the assessee was found in possession of a sum Rs. 1,35,000 while he was travelling in a car on October 27, 1971. In his return of income, the assessee has shown Rs. 1,35,000 as borrowings, in Part III of the return. The assessee's explanation as to source of this borrowing was not found acceptable and the amount was deemed to be income of the assessee from undisclosed sources under the Income-tax Act for the assessment year 1972-73. Penalty proceedings in respect of concealment of income which was added to the assessee's income as income from undisclosed sources were also initiated and penalties were levied. The Tribunal ultimately in the case of the assessee under the Income-tax Act had foun ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... though he can be visited with the consequence of fiction created under section 68 of that Act, and for the unacceptability of his explanation the amount is liable to be included as income from undisclosed sources, it did not necessarily follow that it was the income of the assessee. There being no such fiction available, under the Wealth-tax Act, that such deemed income is to be treated as deemed wealth of the assessee, for the purposes of wealth-tax assessment, the Wealth-tax Officer could not have fallen back on the analogy of income-tax proceedings in the wealth-tax proceedings. That apart, the Tribunal further found that apart from the explanation furnished during the course of income-tax proceedings, there was no material to show that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssed by him on the valuation date and not on any hypothetical sum without taking into account the liability attached with it. If the value of a house has to be included in the net wealth of the assessee, any encumbrance which it carries with it is also to be deducted from its value. Similarly if a deemed income is to be included in the net wealth, only the net sum after adjusting the liability attached will make its net value includible in taxable wealth. If the alleged borrowing of the assessee is held to be income of the assessee of the relevant year, it carried with it liability to pay tax and penalty thereon under the Act, and such liability is relatable to the end of the previous year relevant to the assessment year. That is the valuat ..... X X X X Extracts X X X X X X X X Extracts X X X X
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