| Case ID |
2134c99c-b061-44d6-8d30-21519db52b00 |
| Body |
View case body. Login to View |
| Case Number |
D-2741 of 1960 |
| Decision Date |
Feb 29, 1972 |
| Hearing Date |
|
| Decision |
The Madras High Court held that the Tribunal erred in cancelling the penalty imposed under section 271(1)(c) of the Income-tax Act, 1961. The court emphasized that the reassessment completed on 29-2-1972 revealed concealment of income due to the unexplained hundi credits, and the presumption of concealment under the Explanation to section 271(1)(c) was applicable. The court concluded that since the income returned by the assessee was significantly less than the assessed income, the burden was on the assessee to prove the absence of concealment, which it failed to do. Therefore, the penalty was rightly imposed. |
| Summary |
In the case of Commissioner of Income Tax v. C.J. Sheth, the Madras High Court addressed the issue of penalty under the Income-tax Act, 1961 for the assessment year 1959-60. The court found that the original assessment was completed on 12-8-1960, but the assessment was reopened to investigate spurious hundi loans. The assessee failed to substantiate the genuineness of these loans during both assessment and penalty proceedings. The court ruled that the Tribunal incorrectly applied the provisions of the repealed 1922 Act instead of the 1961 Act. With the reassessment completed on 29-2-1972, the court confirmed that the penalty under section 271(1)(c) was rightly imposed as the assessee did not provide evidence to refute the presumption of concealment. This case underscores the importance of the burden of proof on the taxpayer in penalty proceedings and the applicability of the relevant laws based on the date of assessment completion. |
| Court |
Madras High Court
|
| Entities Involved |
Not available
|
| Judges |
Ratnam, J.,
Bakthavatsalam, J.
|
| Lawyers |
C.V. Rajan,
V. Ramachandran
|
| Petitioners |
Commissioner of Income Tax
|
| Respondents |
C.J. Sheth
|
| Citations |
1989 SLD 2664 = (1989) 179 ITR 30
|
| Other Citations |
Jain Bros. v. Union of India [1970] 77 ITR 107 (SC),
R. Kuppuswamy Chetty v. CIT [1982] 135 ITR 235 (Mad.) (FB),
Maya Rani Punj v. CIT [1986] 157 ITR 330 (SC),
CIT v. Bihar Cotton Mills Ltd. [1988] 170 ITR 290 (Pat.),
CIT v. Anwar Ali [1970] 76 ITR 696 (SC),
CIT v. Mussadilal Ram Bhawse [1987] 165 ITR 14 (SC),
Vishwakarma Industries v. CIT [1982] 135 ITR 652 (Punj. & Har.) (FB),
Chuharmal v. CIT [1988] 172 ITR 250 (SC)
|
| Laws Involved |
Income-tax Act, 1961,
Indian Income-tax Act, 1922
|
| Sections |
271(1)(c),
147(a),
297(2)(g),
28(1)(c)
|