TMI Blog1995 (7) TMI 60X X X X Extracts X X X X X X X X Extracts X X X X ..... ave heard learned counsel on either side at length and the petition is, therefore, finally disposed of at the admission stage. The petitioner is assessed to income-tax and the impugned orders relate to the assessment year 1988-89. A search under the provisions of the Act was conducted at the business premises of the assessee and the other members of his family and during the course of that search certain loose papers were found showing receipt of certain sums of money. During the course of a search, the petitioner surrendered a sum of Rs. 1,00,000. On March 27, 1991, the petitioner filed a return of income for the assessment year 1988-89 showing income of Rs. 1,30,630. The assessment was completed on the same day making an addition of Rs. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ng that Explanation 5 to section 271(1)(c) was applicable only where a valuable article or thing was found and loose papers do not constitute valuable article or thing. Learned counsel for the petitioner placed reliance on Bhagwandas Narayandas v. CIT [1975] 98 ITR 194 (Guj), in which it was held that fixed deposit receipts and title deeds for immovable property are not assets within the meaning of section 132(5) of the Act and rule 112A of the Income-tax Rules. Learned counsel for the petitioner, therefore, contended that on this view no penalty could have been levied for the year in question. The contention is thoroughly untenable. The petitioner has not filed a copy of the assessment order and, therefore, the exact basis on which the add ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the remaining addition of Rs. 1,11,148 does not arise and the Assessing Officer had not done that. Therefore, the argument that the said Explanation was not applicable to that sum carries us nowhere. By virtue of Explanation 1 to section 271(1)(c) where in respect of any facts material to the computation of the total income of any person, such person furnishes an explanation which he is not able to substantiate and fails to prove that such explanation is bona fide and that all the facts relating to the same and material to the computation of his total income have been disclosed by him, then the amount added or disallowed in computing the total income of such person shall, for the purpose of clause (c) of that sub-section, be deemed to repre ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... were not placed before him and the order on a question of law could not be binding in independent proceedings for another year. The question of invoking the principles of res judicata, therefore, did not arise. Lastly, it was contended that the return was filed after an agreement with the Assessing Officer and that is why the assessment was made on the very date on which the return was filed. It appears to have been so made because the limitation was to expire a few days hence and the necessary exercise for the assessment seems to have already been done. The return declared an income of Rs. 1,36,630 while the assessment was made by addition of a further sum of Rs. 2,11,448. It, therefore, cannot be said that the assessee declared an inco ..... X X X X Extracts X X X X X X X X Extracts X X X X
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