DY CIT Vs. MOHD FAROOQ

JUDGEMENT

(1.) This appeal by the revenue is directed against the order of Commissioner (Appeals)-U, Lucknow, dated 31-1-2002, for the assessment year 1995-96.

(2.) The revenue has challenged the deletion of the addition of Rs. 1,80,000.

(3.) The brief facts, as taken from the record, are that on 21-4-1994, SHO, GRP, Police Station Charbagh, Lucknow, seized cash of Rs. 1,80,000 from the possession of Shri Nadimul Haque, son of Shri Hamisul Haque, resident of Mirzapur, Gorakhpur, who is stated to be employee of the assessee. Subsequently, cash was seized and requisitioned under section 132A of the Income Tax Act by DIP, Investigation, Kanpur. Shri Nadimul Haque stated before the police as well as Income Tax Authorities that in fact the money did not belong to him but to the assessee and he was carrying the cash to Nasik by train. In the proceedings under section 132(5) of the Act, assessee Shri Mohd. Farooq, proprietor of M/s Mohd. Nasim Mohd. Amin Fruit Merchant and Commission Agent, Gorakhpur, admitted that the cash was sale proceeds of goods sold on behalf of grape farmers and agriculturists of Nasik and the assessee had deputed Shri Nadimul Haque to remit the same to the concerned parties. However, the assessee's version was not believed under section 132(5) of the Income Tax Act and the cash in question was treated to be the undisclosed income of the assessee. The assessee in compliance to the notice under section 142(l) of the Income Tax Act filed return of income at Rs. 37,200 showing income from business of dealing in grapes and commission agency and dealing in vegetables. It was explained by the assessee during the course of assessment proceedings that the cash belonged to the agriculturists and grape farmers based at Nasik as under <FRM>JUDGEMENT_28_LAWS(ALL)6_20041.html</FRM>