TMI Blog1981 (2) TMI 100X X X X Extracts X X X X X X X X Extracts X X X X ..... m to be sold at a later date when the rate prevailing in the market was more favourable. The assessee is a commission agent and it is a part of his trade to receive goods from his constituents who are generally cultivators and dispose them off, according to their instructions. Sometimes when a sale is not immediately effected the goods continue to be in his possession and custody till such time rate goes up in the market at which the sale can take place. he had caused these persons four in number to the produced before the ITO. He also had furnished their statement in affidavits. The ITO had caused these persons to be examined who had adopted that the goods alleged to have been found belong to them. They had affirmed that these goods were l ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... vy, he proceeded under s. 274 (2) to refer to the IAC Range-II, Amritsar. The IAC called upon the assessee as to why a penalty should not be levied under s. 271(1)(c) for having concealed the income of Rs. 36,352 from the return he had made on the basis of which assessment was finalised on 19th Feb., 1974. The assessee raised several submissions claiming that he had not made any concealment of income and, therefore, he was not liable under s. 271(1)(c). The reasons for the addition of Rs. 36,352 according to him was not that this amount represented income. The reason was according to him that his explanation which he had tendered was not found satisfactory. He did not claim that the Toria in 284 bags belonged to him. He had brought sufficie ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... belonged to above named four persons who had entrusted the same to the assessee for disposing it off at a time when the market rate was more favourable. It was not a case where the ITO has discovered a part of the income which the assessee had failed to show in his return. It was a case about the source of a commodity found in the possession of the assessee for which explanation tendered by him has not been found to be satisfactory. In this view of the matter it was not justified on the part of the lower authorities to have held that he had been guilty of causing any concealment of income. Therefore, the principle set out in the case of Anwar Ali by Supreme Court was to apply. As far as finding of the IAC regarding the interpolation in the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sed on behalf of the assessee. It is true that the explanation advanced by the assessee to account for the 284 bags of Toria was not found satisfactory either by the ITO or by the AAC. We have also upheld the finding of the AAC in an appeal filed against his order by the assessee representing the value of 284 bags of Toria. We do not find his explanation to be satisfactory but this does not entitle any one to reach a finding that assessee is guilty of concealment of any income as referred to in s. 271(1)(c) of the Act. Addition has been confirmed on the basis of our finding that the explanation tendered by the assessee is not satisfactory. The ITO had nothing further than relying on these finding to prove the concealment of income. The asse ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sessment may not be found effective for upholding a charge of concealment under s. 271(1)(c). In our view the assessee cannot be held liable for having caused any concealment of income within the meaning of s. 271(1)(c). The position does not change because the IAC had applied the provision contained in the explanation to s. 271(1)(c). As has been rightly pointed out by the counsel for the assessee that there was no fraud committed by the assessee nor was there any evidence that he was liable for gross negligence. The onus to prove the concealment will continue to be with the ITO in the circumstances and facts of the case. No support can be derived from the finding to the ITO which has been relied upon by the IAC that there was interpolatio ..... X X X X Extracts X X X X X X X X Extracts X X X X
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