TMI Blog1985 (7) TMI 69X X X X Extracts X X X X X X X X Extracts X X X X ..... ase and hence in cancelling the penalty imposed by the Inspecting Assistant Commissioner ?" The facts of the case are that the assessee, who is unfortunately unrepresented before us, had filed a return showing an income of Rs. 2,272. The Income-tax Officer was of the view that a sum of Rs. 13,000 had to be added as income from undisclosed sources. There were two credit entries of Rs. 5,000 and Rs. 8,000 concerning which the Income-tax Officer had made additions. Penalty proceedings under section 271 (1)(c) of the Act were taken. In connection with the cash credit amount of Rs. 8,000, there were two entries, one for Rs. 2,000 in the name of the assessee's wife and Rs. 6,000 in the name of Lal Chand, the assessee's father-in-law. The Inspec ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er similar judgments shows that what has really been held is that after the addition of the Explanation, in a case where the returned income is less than 80% of final assessed income statutory presumptions arise to the effect that income has been concealed and that there is fraud or wilful neglect and also concealment which are to be rebutted by the assessee. Thus, the judgment of the Supreme Court in Anwar Ali's case [1970] 76 ITR 696 aforementioned, to the effect that the mere fact that the explanation of the assessee is false does not shift the onus, has in practice to be modified. What has to happen is that the assessee has first to show that there is no fraud or wilful neglect. If he proves the absence of fraud or wilful neglect, the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ct. So, it was for the assessee to prove the absence of fraud or neglect or that the income was not his. This was not an insurmountable difficulty in the present case, because the two items which were in question were cash credit entries in the name of his own wife and in the name of his own father-in-law. Not much weight has been attached to the amount of Rs. 2,000 in the name of the assessee's wife, as it does not find any place in the penalty order. The only sum involved is the sum of Rs. 6,000 standing in the name of the father-in-law. As regards this, the father-in-law, Shri Lal Chand, himself made a statement that he had made advances at various times to his son-in-law who had returned Rs. 13,000 by cheques and that that sum had been ..... X X X X Extracts X X X X X X X X Extracts X X X X
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