TMI Blog1979 (4) TMI 40X X X X Extracts X X X X X X X X Extracts X X X X ..... ears 1960-61 and 1965-66, it could not prove Hundi loans of Rs. 58,000 in the first year and Rs. 20,000 in the second year and had surrendered the two amounts. The income-tax assessment for the year 1960-61 on the firm was completed on 26th March, 1970 by including the surrendered amount of Rs. 58,000 and the assessment for 1965-66 on 26th Aug., 1970 by including the surrendered amount of Rs. 20,000. In consequence of these two additions, the assessee moved a petition under s. 18(2A) of the WT Act before the CWT accompanied by a revised wealth-tax return including therein assessee's 1/3rd share of the amount of Rs.78,000 added in the income-tax assessments of the firm. This return was filed on 19th Dec., 1970 and had disclosed a net wealth ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d the ratio of Punjab Haryana High Court decision in Mahavir Metal case(1), would be attracted to the facts of the assessee's case. It was contended that what was material was that the assessee owned extra wealth and his act of coming forward himself in the wealth-tax proceedings by filing another return on 19th Dec., 1970, could, at best, be a mitigating factor for determining the quantum of penalty imposed. It was also stated that the question of detection by the Revenue was not strictly relevant in this case. On behalf of the assessee, Shri Arora submitted that even in the case of the firm, the two amounts of Rs. 58,000 and Rs. 20,000 were surrendered and agreed to be added as the firm could not explain the Hundi Loans to the satisfact ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ing a further amount of Rs. 26,000 to the wealth already disclosed, there was no material brought out by the Revenue to show that the amount of Rs. 26,000, in fact, formed part of the assessee's wealth and the assessee had actually made a mistake by disclosing that amount as a part of his wealth as no such amount was available with him and the stand of the firm was that Hundi loans were genuine and the amounts were surrendered to be added only for failure to prove the genuineness of these loans. It was stressed that the firm did not seek the capitalisation of the total amount of Rs. 78,000 and that the assessee filed the petition under s. 18(2A) accompanied by another return showing higher wealth under a mistaken notion and to ward off any ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... om the order of the Commissioner of Wealth-tax dt. 1st June, 1974 in respect of the assessee's petition under s. 18(2A) of the Wealth Tax Act, that the two amounts of Rs. 58,000 and Rs. 20,000 were added in the assessments of the firm, M/s. Kartar Singh Chatha as the firm could not prove the Hundi loans which it eventually decided to surrender. The assessee, in his affidavit dt. 31st Jan., 1975 before the AAC at the earlier stage of the hearing of the penalty appeal had clearly stated that surrender was made in the case of the firm to win peace and to avoid litigation and that the loans were genuine and paid back and that the firm had not sought the introduction of that amount in its books of account. The circumstance of seeking no capitali ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Revenue has brought out no material on record to show that the extra amount of Rs. 26,000 disclosed by the assessee, in fact, represented the concealed wealth of the assessee. The assessee had voluntarily filed a return of wealth on 19th Dec., 1970 after the completion of the assessments of the firm on 26th March, 1970 and 26th Aug., 1970 and this he did consistent with his action in surrendering the amount of Rs. 78,000 in the assessments of the firm. The assessee had explained that the additions in the case of the firm were also agreed to, for its failure to explain the genuineness of the Hundi loans and not that, these were not, in fact, genuine. It was stated by the assessee in his affidavit referred to earlier that the loans were, ..... X X X X Extracts X X X X X X X X Extracts X X X X
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