MOHAMMAD SHABBIR Vs. COMMISSIONER OF INCOME TAX

JUDGEMENT

(1.) THIS is an application under Section 256(2) of the I.T. Act, 1961, by the assessee for a direction to the Income-tax Appellate Tribunal to state the case and refer the following questions of law:

(2.) THE learned counsel for the assessee conceded that all the questions are related and, in fact, the only question that arises is whether, on the facts and in the circumstances of the case, there is justification in law to hold that the assessee had concealed the particulars of his income or furnished inaccurate particulars of such income for the purpose of Section 271(1)(c) of the Act.

(3.) AFTER having heard the parties, we are of the opinion that the findings of the Appellate Tribunal are based on facts and no question of law arises. We are fortified in our view by a decision of this court in CIT v. Pradeep Shantaram Padgaonkar [1983] 143 ITR 785, wherein it was held that the finding of the Tribunal was that there was nothing to show that the assessee was guilty of fraud or gross or wilful neglect in returning the income and it set aside the order imposing penalty on the basis of findings of fact recorded by it on the materials produced on record and, therefore, no question of law arose for reference. Similar is the view taken by other High Courts that no question of law arose out of the Tribunal's order because whether the presumption raised by the Explanation to Section 271(1)(c) had been rebutted or not was essentially a question of fact. [See Addl. CIT v. Thahrayamal Balchand [1980] 124 ITR 111 (Raj), CIT v. Goswami Smt. Chandralata Bahuji [1980] 125 ITR 700 (Raj), CIT v. R. Dalmia [1981] 128 ITR 399 (Delhi), CIT v. Basanta Kumar Agarwalla [1983] 140 ITR 418 (Gauhati) and CIT v. Dewan Singh Gurbachan Singh [1983] 142 ITR 435 (P & H)]. However, the learned counsel for the assessee placed reliance on a decision of the Supreme Court in Addl. CIT v. Chandra Vilas Hotel [1978] 115 ITR 118, but that case has no application here because in that case the questions were whether in view of the provisions of Section 271(1)(c) of the I.T. Act, 1961, and the Explanation thereto, the Appellate Tribunal was right in cancelling the penalty imposed on the assessee and whether the finding of the Tribunal that the assessee was not guilty of any fraud or gross or wilful neglect in returning income at a figure less than 80 per cent. of the, income assessed was arrived at without considering the entire material on record. Reliance was also placed on a decision of this court in CIT v. Ratanlal Mishrilal [1983] 143 ITR 929 (MP), wherein it was held that in the instant case the assessee had discharged the burden cast on him by the Explanation to Section 271(1)(c). He had explained that the amount was a loan from his father and unless the I.T. authorities had something more than a mere estimate of the father's ability to save the amount in question, the guilt of concealment could not be held to have been established and no penalty could be levied in the circumstances of the case. It was also observed that the proof necessary under this Explanation is not one as required in a criminal case. If the assessee has tendered proof of such explanation and the Department was not convinced with it, merely on the possibility of its being unlikely, the conclusion that concealment was established would not be warranted.