TMI Blog1981 (3) TMI 3X X X X Extracts X X X X X X X X Extracts X X X X ..... r 1966-67 disclosed an income of Rs. 2,824. The year of account relating to the said assessment year was Samvat year 2021. According to the assessee, he was carrying on business in grains and grocery. In his capital account for the Samvat year 2021, which he produced before the ITO, the assessee had shown a credit balance of Rs. 72,000 on the first day of the accounting period. He had also credited of Rs. 7,596 as net income from agriculture. The household expenses were shown at Rs. 1,480. In the balance-sheet filed along with the return, Rs. 76,000 were shown in the home-chest account. The ITO completed the assessment under s. 144 of the Act. He found that the cash balance was not genuine. The assessee had filed returns for the assessment ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... been produced to show that the so-called land belonging to the appellant was really cultivable. The appellant also has not shown as to how such a large amount was kept in the house particularly when banking facilities were available in the nearby town. " Being aggrieved by the order of the AAC, the assessee went in appeal before the Income-tax Appellate Tribunal. The Tribunal took the view to the effect that the assessee could not have made such a huge amount of income in the very first year at the very threshold. The Tribunal further observed that the ITO and the AAC had disbelieved the assessee's statement that he was in possession of the cash amount of Rs. 72,000 and held that he had shown the cash balance only to explain the investmen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... produced by the assessee were not found to be reliable. The Tribunal erred in assuming the assessee's case to the effect that the credit entry of Rs. 72,000 in his capital account on the first day of the year of account was believed by the ITO and the AAC. The accounts were not accepted either by the ITO or the AAC. Therefore, it would not be correct to say that the entry of Rs. 72,000 is made on the first day of the year of account. The accounts could have been created at any time and entry of Rs. 72,000 though made later on could have been shown to have been made on the first day of the year of account. There is, therefore, no justification for the observations made by the Tribunal to the effect that huge income of Rs. 72,000 could not ha ..... X X X X Extracts X X X X X X X X Extracts X X X X
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