RUKMANI BAHU Vs. ADDITIONAL COMMISSIONER OF INCOME TAX

JUDGEMENT

(1.) IN pursuance of directions issued by this court, the INcome-tax Appellate Tribunal, Delhi Bench C, has referred the following question for our opinion :

(2.) THE assessment year in question is the year 1964-65. THE assessee who carried on money-lending business filed a return showing an income of Rs. 1,326 from property and a loss of Rs. 255 from business. THE ITO, however, completed the assessment on a total income of Rs. 52,931. This amount was computed by making the following addition :

(3.) THE assessee preferred an appeal to the Tribunal. THE Tribunal held that although the explanation of the assessee in respect of the deposit made was rejected for assessment purposes, that by itself would not justify inclusion of the amount for levy of penalty. Following the decision of the Supreme Court in CIT v. Anwar Ali [1970] 76 ITR 696, it held that the onus of proving that the case fell within Section 271(1)(c) lay upon the department and as in its view the department had failed to discharge that onus the order levying penalty could not be sustained. It accordingly allowed the appeal.