[2020] 121 taxmann.

com 348 (Article)

Date of Publishing: November 28, 2020

BURDEN OF PROOF UNDER DEEMING PROVISIONS OF INCOME TAX ACT,

1961 – AN ANALYSIS
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SANJAY BANSAL AMIT PARSAD

Senior Advocate Advocate

The hardest thing in the world to understand is the income taxes.

- Albert Einstein 1Introduction:

The question as to whether on whom burden of proof lies when a deeming provision is applicable under
the Income-tax Act, 1961 [in short, the 'Act'] has assumed significance with the emergence of judicial
opinions having been expressed by various Hon'ble High Courts and the Hon'ble Supreme Court.
Before analysing the judgments on the issue rendered by the Hon'ble Supreme Court on the broad
distinction between 'burden of proof' and 'onus of proof', it would be apposite to make brief reference to
some of the relevant deeming provisions under the Act.

Section 41(1)(a) of the Act casts a burden on the assessee to establish remission and cessation of liability
in relevant assessment year where benefit has been obtained earlier by the assessee. Similarly, the
provisions of Section 50C(1) of the Act provides that where the consideration received or accruing as a
result of transfer of a capital asset being land or building or both is less than the value adopted or
assessed or assessable by any authority of the State Government for the purpose of payment of stamp
duty in respect of transfer of capital asset, then the value adopted by the stamp valuation authority shall
be deemed to be the full value of consideration received or accruing as a result of such transfer. On an
objection raised by the assessee challenging the valuation adopted by stamp valuation authority which
is deemed to be full value of consideration, the onus of proof then lies on the Assessing Officer to refer
the matter to the valuation officer in view of the express provisions of Section 50C(2) of the Act. Still
further, the provisions of Section 68 of the Act provide for taxing the unexplained cash credits. If no
explanation is offered by the assessee about the nature and source of such cash credits or the
explanation offered is in the opinion of the Assessing Officer not satisfactory, the cash credits shall be
deemed to be income of the assessee. Thus, the burden is on the assessee to establish to the satisfaction
of the Assessing Officer the following three things to obviate the mischief of Section 68 of the Act:

  Proof of identity of the creditors;

  Capacity of creditors to advance money; and
  Genuineness of transaction.

Only when the aforesaid three ingredients are established, the burden is said to be discharged prima
facie and thereafter the onus lies of the Department/Revenue to demonstrate with evidence the falsity
of any explanation tendered by the assessee in regard thereto. It has been held that merely proving the
 identity of the creditors does not discharge the onus of the assessee, if the capacity or credit-worthiness
has not been established.

Burden of Proof and Onus of Proof:

The words, 'Burden of Proof' and 'Onus of Proof' do not find mention in any of the provisions of the Act.
The law relating to the Burden of Proof and Onus of Proof has been provided under the provisions of
the Indian Evidence Act, 1872. The Evidence Act does not apply to proceedings under the Income-tax
Act. The rigours of rule of evidence contained in the Evidence Act though not applicable to the Income-
tax Act, on first principles and on general law, are applicable to proceedings under the Income-tax Act.
Similar are the provisions namely, Section 69 to 69D of the Act in regard to unexplained investment,
money, bullion, jewellery, valuable article, expenditure, borrowing etc. Still further, Explanation 2 to
Section 147 of the Act provides for deemed cases of reassessment of income chargeable to tax which
have escaped assessment. There are various other provisions similar to the aforesaid deeming
provisions under and in terms of which burden of proof lies on the Department/Revenue before onus of
proof is shifted on the assessee. 3

"Section 101 - Burden of proof.

Whoever desires any Court to give judgment as to any legal right or liability dependent on the
existence of facts which he asserts, must prove that those facts exist.
When a person is bound to prove the existence of any fact, it is said that the burden of proof lies on
that person.
Section 102 - On whom burden of proof lies.
The burden of proof in a suit or proceeding lies on that person who would fail if no evidence at all
were given on either side."
Section 103 - Burden of proof as to particular fact.
The burden of proof as to any particular fact lies on that person who wishes the Court to believe in
its existence, unless it is provided by any law that the proof of that fact shall lie on any particular
person."

Burden of proof has two distinct meanings, namely, (i) burden of proof as a matter of law and
pleadings; and (ii) burden of proof as a matter of adducing evidence. Section 101 of the Evidence Act
aforesaid deals with matter of law and pleadings and illustrates the burden of proof in the sense of
proving a case. It lays down that whoever wants a court to give judgment in his favour as to legal right
or liability dependent on the existence of some facts, must prove the existence of those facts. In other
words, he who alleges a fact must prove it, is the real import in sum and substance of the said provision.
Section 102 of the Evidence Act aforesaid deals with burden of proof in the sense of adducing evidence.
It lays down that the burden of adducing the evidence rests upon the party who would fail if no evidence
at all, or no more evidence, as the case may be, was adduced by the either side. Once the burden is
discharged the onus to disprove lies on the other side by way of onus of proof. Thus, there is an essential
distinction between 'burden of proof' and 'onus of proof'. Burden of proof remains static and never
shifts, but the onus of proof keeps on shifting with the evaluation of evidence. Sections 101 to 106 of the
Indian Evidence Act, 1872 contain the provisions regarding the burden of proof in various contexts.
Reference be made to the following provisions of the Indian Evidence Act, 1872 for a proper
understanding of the concept of Burden of Proof: 4 The following observations of Hidayatullah, J.,
speaking for the Hon'ble Supreme Court in Narayan Bhagwantrao Gosavi Balajiwale v. Gopal
Vinayak Gosavi,5

"…the expression "burden of proof" really means two different things. It means sometimes that a
party is required to prove an allegation before judgement can be given in its favour; it also
means that on a contested issue, one of the two contending parties has to introduce evidence. …
The burden of proof is of importance only where by reason of not discharging the burden which
was put upon it, a party must eventually fail. Where, however, parties have joined issue and have
led evidence and the conflicting evidence can be weighed to determine which way the issue can be
decided, the abstract question of burden of proof becomes academic…" (Emphasis supplied)

Similarly, in Kalwa Devadattam v. Union of India, deserve to be kept in focus:6

So far as the Income-tax Act is concerned the position with regard to burden of proof viz., the claim for
deduction and/or exemption by an assessee and/or the claim as to whether a particular receipt is
revenue receipt or capital receipt, the law is settled by the Hon'ble Supreme Court of India. The burden
of proof or initial onus is on the Department/Revenue to prove that a particular receipt is liable to be
taxed as revenue receipt under the Act, but the extent of the burden always depends upon the nature of
the income and the circumstances in which it was made. Once the assessee gives an explanation which
in the opinion of the Department/Revenue is not true and which could not reasonably be true, the
burden was on assessee to prove that what they stated was true and whatever burden was on the
Department/Revenue stood shifted thereafter. Shah, J., speaking for the Hon'ble Supreme Court held
that - "The question of onus probandi is certainly important in the early stages of a case. It may also
assume importance where no evidence at all is led on the question in dispute by either side; in such a
contingency the party on whom the onus lie to prove a certain fact must fail. Where however evidence
has been led by the contesting parties on the question in issue, abstract considerations of onus are out
of place; the truth or otherwise of the case must always be adjudged on the evidence led by the parties."
(Emphasis supplied)7 In all cases in which a receipt is sought to be taxed as income, the burden lies
upon the Department/Revenue to prove that it is within the taxing provision. Where however a receipt
is of the nature of income, the burden of proving that it is not taxable because it falls within an
exemption provided by the Act lies upon the assessee. 8 A Constitutional Bench of the Hon'ble Supreme
Court in Commissioner of Customs (Import), v. Dilip Kumar & Co.,9

When a question arises as to whether a cash credit appearing in the books of account of an assessee has
to be accepted or to be rejected and addition is to be made in accordance with Section 68 of the Act, the
burden is on the assessee to establish the identity of his creditor, the capacity of the creditor to advance
the money and the genuineness of the transaction. If the assessee establishes the aforesaid pre-
conditions, then it would be for the Department/Revenue to disprove the same. has pronounced that -
(1) Exemption notification should be interpreted strictly; the burden of proving applicability would be
on the assessee to show that his case comes within the parameters of the exemption clause or
exemption notification; and (2) When there is ambiguity in exemption notification which is subject to
strict interpretation, the benefit of such ambiguity cannot be claimed by the subject/assessee and it
must be interpreted in favour of the revenue. 10 As rightly observed by Lord Hansworth M.R. in Stoney
v. Eastbourne R.D. Council:11
Interpretation of a deeming provision - Principles:

Deeming fiction is a creation of modern statutes and sometimes introduced to include what is
impossible, though the Legislature is quite competent to enact deeming provisions, for the purpose of
assuming existence of a fact which does not really exist. "…there can only be sufficient evidence to shift
the onus from one side to the other if the evidence is sufficiently prima facie to establish the case of the
party on whom the onus lies. It is not merely a question of weighing feathers on the one side or the
other, and on saying that if there were two feathers on one side and one on the other that would be
sufficient to shift the onus. What is meant is, that in the first instance, the party on whom the onus lies
must prove his case sufficiently to justify a judgment in his favour if there is no other evidence." 12
Although the word 'deemed' is usually used in the statutes, it may be enacted without using that word. 13
For instance, the words 'as if' can also be used to create a legal fiction/deeming fiction. 14 For
interpreting the provision containing a legal fiction the court has to ascertain for what purpose the
fiction is created by the Legislature. 15 Legal fictions are created only for some definite purposes and
these have to be limited to that purpose and cannot be extended beyond that legitimate field 16 or beyond
the language of the Section by which it is created. 17 A legal fiction may also be interpreted narrowly to
make the statute workable.18

Relevant case laws under deeming provisions of the Act:

On the issue of burden of proof and shifting onus, a reference to the following cases would be
advantageous for the sake of clarity.

The Hon'ble High Court of Punjab & Haryana in the case of CIT v. Chandni Bhuchar Thus, the
introduction of deeming fiction may reflect introduction of burden of proof on the assessee or the
Department/Revenue by the Legislature. 19

The view of the High Court of Punjab & Haryana with respect to the deeming provision of Section 50C
of the Act is that onus of proof lies on the Department/Revenue to bring on record any evidence to the
effect that higher amount of sale consideration had passed on to the seller from the buyer in addition to
the amount of sale consideration recorded in the deed. The amount at which valuation has been done by
the stamp authorities could not be taken as actual sale consideration and the value shown in the sale
deed has to be accepted. The circle rates as stipulated under section 50C of the Act cannot be sole
concluding reason to hold that there is an understatement of sale consideration and adopt the valuation
done for the purpose of stamp duty.

In CIT v. Jawahar Lal Oswal, affirmed the view taken by the Tribunal that the valuation done by any
State Agency for the purpose of stamp duty would not ipso facto substitute the actual sale consideration
as being passed on to the seller by the purchaser in the absence of any admissible evidence. The
Assessing Officer is obliged to bring on record positive evidence supporting the price assessed by the
State Government for the purpose of stamp duty. From a plain reading of the provision, it emerges that
the value adopted or assessed by any authority of a State Government for the purpose of payment of
stamp duty in respect of land or building or both, shall for the purpose of Section 48 of the Act be
deemed to be the full value of the consideration received or accruing as a result of transfer. It nowhere
provides that the valuation done by the State Government for the purpose of stamp duty etc., would
ipso facto take place the actual consideration as being passed on to the seller by the purchaser in the
absence of any other evidence. The Assessing Officer is required to bring positive evidence on record
indicating the fact that assessee has paid anything more than the one disclosed in the purchase deed. 20

The Hon'ble Court with regard to the interpretation of the deeming provision held:

"…The principle that governs a deeming provision is that the initial onus lies upon the revenue to
raise a prima facie doubt on the basis of credible material. The onus, thereafter, shifts to the
assessee to prove that the gift is genuine and if the assessee is unable to proffer a credible
explanation, the Assessing Officer may legitimately raise an inference against the assessee. If,
however, the assessee furnishes all relevant facts within his knowledge and offers a credible
explanation, the onus reverts to the revenue to prove that these facts are not correct. The revenue
cannot draw an inference based upon suspicion or doubt or perceptions of culpability or on the
quantum of the amount, involved. Any ambiguity or any ifs and buts in the material collected by
the Assessing Officer must necessarily be read in favour of the assessee, particularly when the
question is one of taxation, under a deeming provision. Thus, neither suspicion/doubt, nor the
quantum shall determine the exercise of jurisdiction by the Assessing Officer. The above exposition
shall not be misconstrued to restrict the power of the revenue to raise an inference as to the efficacy
of material produced by or before the Assessing Officer. …A deeming provision requires the
Assessing Officer to collect relevant facts and then confront the assessee, who is thereafter,
required to explain incriminating facts and in case he fails to proffer a credible information, the
Assessing Officer may validly raise an inference of deemed income under section 69A of the Act. …
If the assessee proffers an explanation and discloses all relevant facts within his knowledge, the
onus reverts to the revenue to adduce evidence and only thereafter, may an inference be raised,
based upon relevant facts, by invoking the deeming provisions of Section 69A of the Act. It is true
that inferences and presumptions are integral to an adjudicatory process but cannot by themselves
be raised to the status of substantial evidence or evidence sufficient to raise an inference. A
deeming provision, thus, enables the revenue to raise an inference against an assessee on the basis
of tangible material and not on mere suspicion, conjectures or perceptions. It would also be
necessary to reiterate that it is not perceptions but concrete facts that underline quasi judicial
determinations and where concrete facts are not available, relevant facts, as would raise a credible
inference of culpability requiring an assessee to rebut the inference so raised." (Emphasis supplied)

Thus, the Hon'ble High Court on the basis of the distinction between burden of proof and onus of proof
rightly came to the conclusion that once a satisfactory explanation had been tendered by an assessee,
the burden of proof stood discharged, and thereafter, under a deeming provision in the absence of any
tangible material no contrary inference could be drawn against the assessee.

Reference may be made to the decision of the Hon'ble Supreme Court in CIT v. Smt. P.K. Noorjahan
the assessee received two gifts, valued at $200,000 each by demand drafts from Dr. O.S. Gill and Shri
B.P. Bhardwaj for and on behalf of his daughters, Ms. Monica Oswal and Ruchika Oswal on the
occasion of their marriage while he was in London. The gifts were received by demand drafts, while the
assessee was in London. The Assessing Officer served a notice under section 143, addressed queries to
the assessee, obtained information through the Central Board of Direct Taxes, from the Inland
Revenue, Great Britain, examined Dr. O.S. Gill but as he was not satisfied with the explanation offered
by the assessee, held that the assessee had not been able to prove the genuineness of the gifts. He,
therefore, concluded that the gifts represented the income of the assessee and added those amounts to
assessee's taxable income under section 69A of the Act. A protective assessment was also made in the
hands of the assessee's daughters. Separate appeals was preferred by the assessee's and his daughters
challenging the addition made by the Assessing Officer before the Commissioner of Income-tax
(Appeals), which was partly allowed by accepting the gift made by Dr. O.S. Gill but rejecting the gift
made by Shri B.P. Bhardwaj. Aggrieved by the Order of the Commissioner of Income-tax (Appeals) the
assessee along with his daughters and the Department/Revenue preferred appeals before the Tribunal.
The Tribunal while accepting the appeals filed by the assessee and his daughters and rejecting the
appeal filed by the Department/Revenue held that the Department/Revenue had not brought forth any
credible material that would raise an inference under the deeming provision of Section 69A of the Act
that the gifts represented the income of the assessee and addition was accordingly deleted. Prejudiced
by the Order of the Tribunal the Department/Revenue preferred four appeals, one in the case of the
assessee, two appeals in the case of his daughters and fourth pertaining to gift tax before the Hon'ble
High Court raising the questions as to whether the assessee had discharged the onus of establishing that
gifts made in favour of his daughters through him by Dr. O.S. Gill and Shri B.P. Bhardwaj was valid and
the same be treated as the income of the assessee under section 69A of the Act. 21

"The submission is that once the explanation offered by the assessee for the sources of the
investments found to be non-acceptable the only course open to the ITO was to treat the value of
the investments to be the income of the assessee. The submission is that the word 'may' in section
69 should be read as 'shall'. We are unable to agree. As pointed out by the Tribunal, in the
corresponding clause in the Bill which was introduced in the Parliament, the word 'shall' had been
used but during the course of consideration of the Bill and on the recommendation of the Select
Committee, the said word was substituted by the word 'may'. This clearly indicates that the
intention of the Parliament in enacting section 69 was to confer a discretion on the ITO in the
matter of treating the source of investment which has not been satisfactorily explained by the
assessee as the income of the assessee and the ITO is not obliged to treat such source of investment
as income in every case where the explanation offered by the assessee is found to be not
satisfactory. The question whether the source of the investment should be treated as income or not
under section 69 has to be considered in the light of the facts of each case. In other words, a
discretion has been conferred on the ITO under section 69 to treat the source of investment as the
income of the assessee if the explanation offered by the assessee is not found satisfactory and the
said discretion has to be exercised keeping in view the facts and circumstances of the particular
case." (Emphasis supplied)

Thus, the principle which is discernable from P.K. Noorjahan's case(supra) is that unlike under section
68 of the Act, the provisions of Section 69 of the Act uses the expression 'may' and not 'shall', therefore
once an explanation is tendered by an assessee in a case where provisions of Section 69 of the Act have
been invoked by the Assessing Officer then although a discretion vests in the Assessing Officer to make
the addition by rejecting the explanation of the assessee in view of the word 'may' used therein by the
Legislature yet, it is a different matter, as in the case of Jawahar Lal Oswal's case(supra), that there is
evidence in possession of the Assessing Officer contradicting the explanation of the assessee justifying
the addition; and therefore, the judgment rendered by the Supreme Court is on the correct premises.
The principles of law enunciated by the Hon'ble Supreme Court for invoking the provisions of Sections
68 and 69 of the Act may be summarized for understanding the relevance of the burden of proof vis-à-
vis onus of proof:

  The burden is on the assessee to prove or explain the source of the money or
investment. Where an assessee fails to prove satisfactorily the source and nature of
the investment, the Assessing Officer is entitled to draw the inference that the
amount is of an assessable nature.22
  The initial onus of proving the source of a sum of money received by an assessee is
on him. Once the assessee submits the documents relating to identity, genuineness
of the transaction, and credit worthiness, then the Assessing Officer must conduct
an inquiry, and call for more details before invoking Section 68 of the Act. If the
 nature and source of a receipt cannot be satisfactorily explained by the assessee, it is
open to the Department/Revenue to hold that it is the income of the assessee and no
further burden lies on the revenue to show that income is from any particular
source.23
  The discretion conferred on the Assessing Officer under section 69 of the Act to treat
the source of investment as the income of the assessee if the explanation offered by
the assessee is not found satisfactory has to be exercised keeping in view the facts
and circumstances of the particular case.24
  The opinion of the Assessing Officer regarding his satisfaction is required to be
formed objectively based on proper appreciation of material and other attending
circumstances available on record. Application of mind is the sine qua non for
forming the opinion. The burden is on the assessee to take the plea that, even if the
explanation is not acceptable, the material and attending circumstances available on
record do not justify the sum found credited in the books to be treated as a receipt of
an income nature.25

Recently, the Hon'ble Supreme Court in Pr. CIT v. NRA Iron & Steel (P.) Ltd.,, where while maintaining
the issue of burden of proof to be discharged under section 69 of the Act by the assessee, no discretion
was left with the Assessing Officer to make an addition by reading the word 'may' read as 'shall' for
making an addition by rejecting the explanation given by the assessee, in the background of the factual
position namely, the assessee, a young lady of 20 years, purchased certain lands and submitted that the
investments were financed from out of the savings from the income of properties which were left by her
step-father. The Assessing Officer, however, made an addition of the amount as her income from other
sources. On appeal, the AAC affirmed the order of the Assessing Officer. On second appeal, the Tribunal
observed that though the explanation about the nature and sources of purchase money was not
satisfactory, but in instant case it was impossible for the assessee of such tender age to earn the amount
for a decade or more. The Tribunal held that Section 69 confers only a discretion on the Assessing
Officer to deal with investment and it does not make it mandatory to deal with income of the assessee in
each and every case. Therefore, in view of circum-stances, the Tribunal deleted the addition which was
affirmed by the High Court on reference. The Court categorically observed: 26

  The assessee is under a legal obligation to prove the genuineness of the transaction,
the identity of the creditors, and credit-worthiness of the investors who should have
the financial capacity to make the investment in question, to the satisfaction of the
Assessing Officer, so as to discharge the primary onus.
  The Assessing Officer is duty bound to investigate the credit-worthiness of the
creditor/subscriber, verify the identity of the subscribers, and ascertain whether the
transaction is genuine, or these are bogus entries of name-lenders.
  If the enquiries and investigations reveal that the identity of the creditors to be
dubious or doubtful, or lack credit-worthiness, then the genuineness of the
transaction would not be established.

In West Asia Exports & Imports (P.) Ltd. v. Asstt. CIT, deliberated upon the issue as to whether the
share capital/premium credited in the books of account of the assessee, the onus of proof is on the
assessee to establish by cogent and reliable evidence of the identity of the investor companies, the
credit-worthiness of the investors, and genuineness of the transaction, to the satisfaction of the
Assessing Officer under section 68 of the Act. The Hon'ble Supreme Court after analyzing the various
authorities on the issue held that:27

In ITO v. Santosh Jain the Hon'ble High Court of Madras while construing the provisions of Section
41(1) of the Act held that once the assessee was called upon to prove the credit entries with regard to the
sundry creditors of its erstwhile business, it was for the assessee to establish the current existence of the
creditors and their debts due from assessee and that there was a live link between the creditors and the
outstanding debts. The assessee on being asked to produce evidence with regard to any creditor, who
may have raised the claim against assessee even in past 15-16 years, was unable to produce any
evidence, despite the grant of an opportunity in this regard. The assessee could not discharge the
burden and the case of cessation of liability was made out by the Department/Revenue against him. The
Hon'ble Court concluded that the liability to pay the sundry creditors has ceased in law and drawing
such an inference against the assessee by all the three authorities under the Act and holding that the
trading credits of erstwhile business of the assessee was liable to be taxed as profits of the business
under section 41(1) of the Act was justified in law.28

"…Expln. 2 provides that certain cases specified in cls. (a), (b) and (c) shall be deemed to be cases
where income chargeable to tax has escaped assessment. Clause (a) provides that where no return
of income has been furnished by the assessee although his total income or the total income of any
other person in respect of which he is assessable under this Act during the previous year exceeded
the maximum amount which is not chargeable to income-tax. Therefore, merely because no return
of income has been filed, deeming fiction would not be attracted, unless it is also found that the
total income during the previous year exceeded the maximum amount which is not chargeable to
income-tax. In other words, in order to attract deeming fiction under cl. (a) of Expln. 2, two
conditions are required to be satisfied. One is that no return of income has been furnished by the
assessee. Second is that his total income or the total income of any other person in respect of which
he is assessable under this Act during the previous year exceeded the maximum amount which is
not chargeable to income-tax. Unless the aforesaid two conditions are satisfied, it will not be
permissible to apply the deeming fiction as provided in Expln. 2." (Emphasis supplied)

In CIT v. Lakshman Das Khandelwal,, the Hon'ble High Court of Chhattisgarh dealt with the
interpretation of deeming fiction provided under clause (a) of Explanation 2 to Section 147 of the Act.
The Hon'ble Court held that in order to attract the aforesaid deeming provision, the twin conditions has
to be satisfied i.e., (1) no return of income has been furnished by the assessee; and (2) total income of
the assessee or the total income of any other person in respect of which the assessee is assessable under
the Act during the previous year exceeded the maximum amount which is not chargeable to income tax.
Unless the aforesaid twin conditions are not satisfied, the Assessing Officer cannot invoke the
provisions of clause (a) of Explanation 2 to Section 147 of the Act. The relevant observations of the
Hon'ble may be read as under: 29 a case under the provisions of Section 292BB of the Act which is a
deeming provision providing for notices to valid in certain circumstances, the Supreme Court has held
that - "According to Section 292BB of the Act, if the assessee had participated in the proceedings, by
way of legal fiction, notice would be deemed to be valid even if there be infractions as detailed in said
Section. The scope of the provision is to make service of notice having certain infirmities to be proper
and valid if there was requisite participation on part of the assessee. It is, however, to be noted that the
Section does not save complete absence of notice. For Section 292BB of the Act to apply, the notice
must have emanated from the Department/Revenue. It is only the infirmities in the manner of service
of notice that the Section seeks to cure. The Section is not intended to cure complete absence of notice
itself. Since the facts on record are clear that no notice under section 143(2) of the Act was ever issued
by the Department, the findings rendered. by the High Court and the Tribunal and the conclusion
arrived at were correct. We, therefore, see no reason to take a different view in the matter." Thus, in the
absence a valid notice, the participation of the assessee does not come to the rescue of the
Department/Revenue for validation of any proceedings under the Act by virtue of applicability of
deeming provisions contained in Section 292BB of the Act. Similarly, the Hon'ble High Court of Delhi, 30
Bombay,31 and Madras32

Summation:

From the aforesaid pronouncements, it is profusely clear that the burden of proof may also be on the
Assessing Officer under a deeming provision before the assessee is called upon to discharge the onus of
proof after satisfactory discharge of burden of proof by the Department/Revenue. Thus, under a
deeming provision the question on whom lies the burden of proof would depend upon the nature of the
provision and not necessarily that it would be on the assessee automatically.

■■

1. According to Quote Investigator, a fact-checking blog, Albert Einstein made this statement
to his tax accountant Leo Mattersdorf. In a letter to Time magazine in 1963, eight years
after Einstein's death, Mattersdrof recalled the incident. See:
http://quoteinvestigator.com/2011/03/07/einstein-income-taxes/
2. CIT v. Oasis Hospitalities (P.) Ltd., [2011] 198 Taxman 247/333 ITR 119/9 taxmann.com
179 (Delhi).
3. Chuharmal v. CIT [1988] 172 ITR 250/38 Taxman 190 (SC).
4. Addagada Raghavamma v. Addagada Chenchamma AIR 1964 SC 136.
5. AIR 1960 SC 100.
6. [1963] 49 ITR 165 (SC).
7. Juggilal Kamlapat v. CIT [1964] 52 ITR 811 (All.) affirmed by the Hon'ble Supreme Court in
Juggilal Kamlapat v. CIT [1970] 75 ITR 186 (SC).
8. Parimisetti Seetharamamma v. CIT [1965] 57 ITR 532 (SC); See also: CIT v. Ramakrishna
Deo, [1959] 35 ITR 312 (SC).
9. [2018] 95 taxmann.com 327 (SC)/69 GST 239 . See further: Ramnath & Co. v. CIT [2020]
116 taxmann.com 885 (SC) : [2020] 425 ITR 337 (SC).
10. CIT v. Baishaab Charan Mohanty [1995] 78 Taxman 183/212 ITR 199 (Ori.).
11. [1927] 1 Ch. 367, 397
12. J.K. Cotton Spg. & Wvg. Mills Ltd. v. Union of India, AIR 1988 SC 191.
13. CIT v. Urmila Ramesh, [1998] 96 Taxman 533/230 ITR 422 (SC).
14. Rajasthan State Industrial Development & Investment Corpn. v. Diamond & Gem
Development Corpn. Ltd. [2013] 5 SCC 470.
15. Ex Parte, Walton, In re, Levy, [1881] 17 Ch D 746, p. 756; State of Travancore-Cochin v.
Shanmugha Vilas Cashewnut Factory, Quilon. AIR 1953 SC 333.
16. CIT v. Mother India Refrigeration Industries (P.) Ltd., [1985] 23 Taxman 8 /[1985] 155 ITR
711 (SC); CIT v. Amarchand N. Shroff, [1963] 48 ITR 59 (SC).
17. CIT v. Shakuntala, [1961] 43 ITR 352 (SC). Vodafone International Holdings B. V. v.
Union of India [2012] 17 taxmann.com 202/341 ITR 1 (SC).
18. Nandkishore Ganesh Joshi v. Commr. Municipal Corpn. Kalyan, AIR 2005 SC (para 19).
19. [2010] 323 ITR 510/191 Taxman 142 (Punjab & Haryana) .
20. [2016] 67 taxmann.com 168/382 ITR 453/238 Taxman 225 (Punjab & Haryana) .
21. [1999] 103 Taxman 382 (SC)/237 ITR 570 (SC) .
22. See: A. Govindarajulu Mudaliar v. CIT [1958] 34 ITR 807 (SC).
23. See: Roshan Di Hatti v. CIT [1977] 107 ITR 938 (SC); CIT v. Devi Prasad Vishwanath
Prasad, [1969] 72 ITR 194 (SC); Kale Khan Mohammad Hanif v. CIT [1963] 50 ITR 1
 (SC).
24. See: CIT v. Smt. P.K. Noorjahan (supra).
25. See: CIT v. P. Mohanakala [2007] 161 Taxman 169/291 ITR 278 (SC).
26. [2019] 103 taxmann.com 48 /[2019] 412 ITR 161/262 Taxman 74 (SC) . Review Petition of
the assessee dismissed by the Hon'ble Supreme Court in NRA Iron and Steel (P.) Ltd. v.
Pr. CIT [2020] 117 taxmann.com 752/273 Taxman 14 (SC).
27. [2019] 104 taxmann.com 170/412 ITR 208/262 Taxman 372 (Mad.) .
28. [2012] 21 taxmann.com 531 (Chhattisgarh).
29. [2019] 108 taxmann.com 183/417 ITR 325/266 Taxman 171 (SC) .
30. Rajender Kumar Sehgal v. ITO [2019] 101 taxmann.com 233/260 Taxman 412/414 ITR
286 (Delhi).
31. Sumit Balkrishna Gupta v. Asstt. CIT [2019] 103 taxmann.com 188/262 Taxman 61/[2019]
414 ITR 292 (Bom.).
32. CIT v. M. Hemanathan [2016] 68 taxmann.com 22/ 384 ITR 177/239 Taxman 533 (Mad.).