Judgment

SABYASACHI MUKHARJI, J. :- This petition for leave to appeal is directed against the judgment and order dated 10th Dec. 1985 of the High Court of Madhya Pradesh, Jabalpur. The High Court upheld the imposition of penalty as well as the addition of alleged concealed income in the income-tax assessment of the petitioner. The relevant assessment year with which we are concerned in this application is 1974-75.

2. It appears that the petitioner had submitted his return of income for the assessment year 1974-75 showing a total income of Rs. 3,113/- in response to a notice issued under S. 143(2), Income-tax Act, 1961 (hereinafter called the Act). According to the petitioner, he had derived his income from 2 stores, i.e. M/s. Mohanani Fancy General Stores and M/s. Roopkala General Stores, Durg. It, however, appears that on 19th January, 1974 on the basis of the order passed by the Superintendent, Central Excise, Jagpur, dated 25th Dec. 1975 (sic) there was confiscation of foreign watches from the house of the petitioner and levy of penalty of Rs. 2 lakhs under the Customs Act, 1962. Accordingly, the Income-tax Officer issued a notice calling upon the assessee to show cause why the va