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Pursuant to demonetisation ordinance in 1946 a husband and wife submitted High denomination notes in their respective names in [1953] 24 ITR 16 (Pat).  


Whereas the assessee’s wife in her declaration stated that

“I am in a habit to keep a certain amount of my personal savings in cash and in high denomination notes as it is convenient and safe “.

Whereas the assessee husband gave the reasons as under :

“To meet emergent expenditure in family or business and in high denomination notes as it is convenient.”


Further in an affidavit submitted by the wife it is stated that she had an independent source of income which was a house property in Ranchi alleged to fetch a rent of Rs. 70 per month. The wife had also alleged in the affidavit that she had received presents in cash from relations which she had converted into high denomination notes for the sake of convenience. 


In the absence of anything from the revenue to disprove this explanation and mere rejection of the same without adducing evidence is not relished well by the High Court which held that there is no presumption in law that an amount standing in the name of the wife belongs to the husband. In the absence of evidence to the contrary, the money standing in the name of the assessee’s wife must be presumed to belong to her and the assessee cannot be taxed in respect of such an amount. The onus of proof in such a case will not be on the assessee but will be on the department to show by at least some material that the amount standing in the name of the assessee’s wife does not belong to her but belongs to the assessee.


In this case the tax officer made addition of also sums deposited in the name of wife in the husband assessment which is quashed by the Court. 

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