TMI Blog1960 (1) TMI 52X X X X Extracts X X X X X X X X Extracts X X X X ..... are business. When asked to explain the assessee stated that it represented the sale proceeds of gold ornaments of Srimati Purnima Debi, who is the wife of Chagganlal, one of the members of the Hindu undivided family. The explanation was not accepted by the Income Tax Officer, who held that the amount of ₹ 22,940 was the secreted profit of the hardware business. Taking this and other circumstances into account the Income Tax Officer estimated the income to be ₹ 75,000. But on appeal the estimate of profit was reduced to ₹ 50,000 by the Appellate Assistant Commissioner, Both the Income Tax Officer and the Appellate Assistant Commissioner have taken the view that the building constructed at Ranchi and standing i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tribution of profits.--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 - ***** (c) has concealed the particulars of his income or deliberately furnished inaccurate particulars of such income : he or it may direct that such person shall pay by way of penalty, in the case referred to in Clause (a), in addition to the amount of the Income Tax and super-tax, if any payable by him, a sum not exceeding one and a half times that amount, and in the cases referred to in Clauses (b) and (c), in addition to any tax payable by him, a sum not exceeding one and a half times the amount of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Act is of a penal character. The correctness of this principle was not disputed by the learned Standing Counsel appearing on behalf of the Income Tax Department, but it was contended that there was material in the present case to show that the assessee was guilty of suppression of particulars of his income. In our opinion, however, there is no material in this case to support the finding of the Income Tax Appellate Tribunal that the assessee has concealed the particulars of his income or deliberately furnished inaccurate particulars of his income in the quantum proceeding. In the order under Section 28 (1) (c) of the Income Tax Act the Appellate Tribunal has stated that the explanation offered by the assesses with regard to the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... a for the sale of gold is in the name of Chhaganlal Sarogi the Karta of the assessee family. The purja indicates that gold was sold and not gold ornaments. The purja does not indicate what ornaments have been sold. If it is a fact that the ornaments of the lady had been previously melted and sold, there should be some evidence of melting. No evidence has been produced to establish it. We cannot, therefore, accept assessee's explanation that the sale proceeds credited in the accounts on 30-11-1945 represent the sale proceeds of ornaments belonging to the lady. The nature and source of the gold which was sold has not thus been established by the assessee. There is thus an unexplained increase in the assessee's wealth du ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... und recorded in their books. Similarly the books of M/s. Jokhiram Baijnath for 1963-64, 1964-65 1968-69 and 1969-70 were produced on an earlier occasion. The list of ornaments received by Purnima Devi from her father were verified from the respective entries. If the explanation offered by the assessee in the assessment proceeding was deliberately false it is possible to argue that there was some material before the Income Tax Appellate Tribunal which justified the imposition of penalty upon the assessee under Section 28 (1) (c) of the Act. In the present case, in our opinion there was no material before the Income Tax authorities for holding that the assessee has been guilty of suppression of particulars of his' income wi ..... X X X X Extracts X X X X X X X X Extracts X X X X
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