Commissioner of Income-tax Vs. Aboo Mohmed - Court Judgment

Excerpt:
- order 7, rule 11 (d) & limitation act, 1963, section 12 (1): [dr. k. bhakthavatsala, j] rejection of plaint as barred by limitation appeal against held, the suit for recovery of money is based on a promissory note. promissory note came to be executed on 12.4.2000. as per section 12 (1) of the limitation act, the date on which promissory note executed shall be excluded. therefore, the last date for filing suit was 12.4.2003. as 12.4.2003 to 15.4.2003 (both days inclusive) were general holidays the suit filed on 16.4.2003 was well in time. the trial court by a cryptic order, allowed the application filed under order 7, rule 11 (d) and erred in rejecting the plaint as barred by limitation. the trial court has passed the impugned order in a cavalier manner and the same has resulted in delay in disposal of the suit and therefore, it is a fit case to impose exemplary costs of rs.10,000/-. order 8, rule 1: [s.b.sinha & cyriac joseph,jj] written statement time limit to file written statement filed after 3 years - rejected and plaintiff was ordered to examine his witnesses - sufficient reasons recorded in support of order held, interference with order by writ court in absence of finding that there had been failure of justice or order contained an error on face of record is improper. limitation act (36 of 1963)section 12 (1): [dr. k. bhakthavatsala, j] suit for recovery of money based on promissory note - held, the suit for recovery of money is based on a promissory note. promissory note came to be executed on 12.4.2000. as per section 12 (1) of the limitation act, the date on which promissory note executed shall be excluded. therefore, the last date for filing suit was 12.4.2003. as 12.4.2003 to 15.4.2003 (both days inclusive) were general holidays the suit filed on 16.4.2003 would be well within time. - 7. the observation of the tribunal that there was no concealment of income is not correct because the assessee himself has failed to prove the source and the acquisition of that money and ultimately has offered the amount for taxation.v.k. singhal, j.1. the income-tax appellate tribunal has referred the following questions of law arising out of its order dated january 11, 1994, for the assessment year 1986-87.'1. whether, on the facts and in the circumstances of the case, the appellate tribunal was right in law in holding that the assessee has not concealed the particulars of income, as concealment has to be considered with reference to the return of income filed by the assessee, when the assessee has filed the return of income after seizure of cash from the asses-see by the customs and central excise and its seizure by the income-tax department under section 132a ?2. whether, on the facts and in the circumstances of the case, the tribunal was right in law in holding that explanation 5 to section 271(1)(c) does not apply to a proceeding under section 132a ?'2. the facts of the case are that the assessee is an individual. while he was travelling from bombay to trichur, by a bus belonging to madeena travels, the customs and central excise authorities, preventive unit-ii, belgaum, seized cash of rs. 10,51,650 on january 1, 1986, from the assessee. this amount was taken possession of by the income-tax department by warrant of authorization issued under section 132a dated january 3, 1986, and possession was taken of the aforesaid cash by the adi (inv), unit-ii, bangalore, on january 4, 1986. an order under section 132(5) was passed on march 27, 1986. the assessee filed a return of income on july 28, 1986, declaring a total income of rs. 10,59,650 including the seized cash and declaring business income of rs. 8,000 and the return was claimed as having been filed under the voluntary disclosure scheme and immunities under the amnesty scheme were claimed.3. an order under section 143(3) was passed on september 30, 1986, determining the assessee's total income at rs. 20,00,000. in appeal the income estimated from business by the assessing officer was reduced and the total income of the assessee got reduced to rs. 10,76,650. the income-tax officer levied penalty under section 271(1)(c) on the ultimate total income as determined, by treating rs. 10,51,650 being cash seized from the assessee as concealed income of the assessee. the assessee claimed immunity under the amnesty scheme. the assessing officer held that as the return was filed subsequent to the seizure of cash, the assessee cannot claim immunity under the amnesty scheme and he cannot also escape penalty by declaring assets seized by the department. the assessee filed an appeal against the order of the assessing officer under section 271(1)(c) and the commissioner (appeals) held that in view of the assessee disclosing the cash seized as income in the return filed by him on july 28, 198g, on account of his inability to explain the cash and as the original owner disowned it, it cannot be held that the assessee had concealed the particulars of this income. the commissioner (appeals) held that explanation 5 to section 271(1)(c) is not applicable to the case of the assessee as there was no action under section 132 in his case.4. the tribunal confirmed the order of the commissioner (appeals) and held that the assessee cannot be penalised under section 271(1)(c) as the assessee showed the amount which happens to be deemed income under section 69a in his return of income and can by no stretch of imagination be considered to be guilty of concealment of income. the tribunal also held that explanation 5 to section 271(1)(c) of the act does not have any application to cases covered by section 132a.5. the only limited question raised before us is that the tribunal has seriously erred in remitting the penalty on the ground that there was no search under section 132 as the unaccounted money which was considered as income under section 139a (sic) was requisitioned under section 132a. it appears that the tribunal has lost sight of the provisions of sub-section (3) of section 132a which is as under :'132a. (3) where any books of account, other documents or assets have been delivered to the requisitioning officer, the provisions of subsections (4a) to (14) (both inclusive) of section 132 and section 132b shall, so far as may be, apply as if such books of account, other documents or assets had been seized under sub-section (1) of section 132 by the requisitioning officer from the custody of the person referred to in clause (a) or clause (b) or clause (c), as the case may be, of sub-section (1) of this section and as if for the words 'the authorised officer' occurring in any of the aforesaid sub-sections (4a) to (14), the words 'the requisitioning officer' were substituted.'6. this section has considered the action of requisition as that of seizure under section 132(1) and as such the provisions of sub-sections (4a) to (14) of section 132 would apply mutatis mutandis. since it is a deemed search the benefit of the amnesty scheme cannot be taken.7. the observation of the tribunal that there was no concealment of income is not correct because the assessee himself has failed to prove the source and the acquisition of that money and ultimately has offered the amount for taxation.8. the tribunal was also not justified in law in holding that explanation 5 to section 271(1)(c) would not apply to a proceeding under section 132a, in view of the legal position explained above.9. accordingly, the reference is answered in favour of the revenue and against the assessee.