Judgment :- ISMAIL J. The Income-tax Appellate Tribunal, Bengalore Bench, at the instance of the Commissioner of Income-tax, Madras-I, Madras-34, has referred the following question of law for the opinion of this court : "Whether the Tribunal was correct in law in placing the onus on the department to show that the sum of Rs.3, 32, 000 assessed under 'other sources' is 'unearned income' for the purpose of levying of additional surcharge ?" * The Commissioner had asked for reference of two questions. Since the Tribunal referred only one question, the Commissioner applied to this court under section 256(2) of the Income-tax Act, 1961. This court, by anorder dated September 13, 1973, made in T.C.P. No. 12 of 1972, directed the Tribunal to refer another question, namely : "Whether, on the facts and in the circumstances of the case, the Appellate Tribunal was right in law in holding that the sum of Rs. 3, 32, 000 assessed under the head 'other sources' is 'earned income' of the assessee ?" * This question constitutes the subject-matter of T.C. No. 65 of 1975 while the first question constitutes the subject-matter of T.C. No. 170 of 1971. Thus, it will be seen that both these questions deal with a single assessment year, namely, assessment year 1968-69, and the first question is concerned with the onus or burden of proof and the second question is concerned with the finding on the merits. On a search of premises No. 28-A, Krishnappa Naicken Agraharam, on August 31, 1967, cash to the extent of Rs. 3, 24, 500 was seized by the income-tax authorities. Since the assessee was not able to offer any satisfactory explanation regarding this cash the amount was treated as the income of the assessee for purposes of assessment for the assessment year 1968-69. The assessee who was a native of Kilakarai and whose family was staying at Kilakarai maintaining themselves out of the agricultural income, was living in the premises in question paying a rent of Rs. 200 per month and he had the assistance of assistant. The Income-tax Officer estimated the expenses of the assessee and his assistant at Rs. 7, 500 and added that amount to the amount actually seized and thereby arrived at the total income of Rs. 3, 32, 000 as the total income of the assessee for the year 1968-69. 200 per month and he had the assistance of assistant. The Income-tax Officer estimated the expenses of the assessee and his assistant at Rs. 7, 500 and added that amount to the amount actually seized and thereby arrived at the total income of Rs. 3, 32, 000 as the total income of the assessee for the year 1968-69. He assessed the said amount as the income of the assessee from "other sources". He also levied a surcharge treating the entirety of the said amount as unearned income. It is this action of the Income-tax Officer levying a surcharge treating the amount in question as unearned income which was challenged by the assessee. Since the Appellate Assistant Commissioner confirmed the conclusion of the Income-tax Officer the assessee contended before the Tribunal that the surcharge being an additional levy, the burden was on the department to prove that the income in question was unearned income attracting the rate referable thereto. The assessee also contended that the amount in question represented the accumulations of agricultural income and the income which the assessee obtained from his business activity in Ceylon and this contention having been rejected and there being no evidence to show that the amount in question was the income of any investment made by the assessee, the amount in question can only be earned income and could not have been treated as unearned income. The Tribunal held that in a fiscal statute where there is room for doubt regarding the subject-matter of tax, the benefit of doubt has to go to the assessee, and the findings of the Income-tax Officer that the income was unearned income imposed a heavy burden of over Rs. 40, 000 by way of surcharge on the assessee, and therefore, it was for the income-tax authorities to show that the provisions regarding the levy of additional surcharge were applicable to the income of the assessee by showing that such income was unearned income in his hands. With the result, the Tribunal upheld the objection taken by the assessee to the levy of additional surcharge by treating the income as unearned income. It is the correctness of this conclusion of the Tribunal that is challenged in the form of the two question extracted above.The relevant provisions relating to the levy of additional surcharge are contained in the First Schedule, Part I, Paragraph A to the Finance Act, 1968. It is the correctness of this conclusion of the Tribunal that is challenged in the form of the two question extracted above.The relevant provisions relating to the levy of additional surcharge are contained in the First Schedule, Part I, Paragraph A to the Finance Act, 1968. The relevant provisions dealing with the surcharge on income-tax are as follows : Surcharges on income-tax. - The amount of income-tax computed in accordance with the preceding provisions of this paragraph shall be increased by the aggregate of surcharges for purposes of the Union calculated as specified hereunder :- (a) where - (i) in the case of an individual or a Hindu undivided family, the amount of unearned income, not being income by way of interest on any security of the Central or State Government or income received in respect of units from the Unit Trust of India, established under the Unit Trust of India Act, 1963 (LII of 1963), included in the total income, or (ii) in any other case, the amount of unearned income included in the total income, exceeds Rs. 30, 000, a surcharge calculated on the difference between the amount of income-tax computed in respect of the income referred to in sub-clause (i) or, as the case may be, sub-clause (ii), if such income had been the total income and the amount of income-tax computed in respect of an income of Rs.30, 000 if it had been the total income, at the following rate, namely :- (1) where the amount of the twenty per cent. of the amount difference does not exceed of such difference; Rs. 10, 000 (2) where the amount of the Rs. 2, 000 plus 25 per cent. of difference exceeds Rs. 10, 000 the amount by which the difference aforesaid exceeds Rs. 10, 000; (b) where - (i) in the case of an individual or a Hindu undivided family, the earned income and income by way of interest on any security of the Central or State Government and income received in respect of units from the Unit Trust of India established under the Unit Trust of India Act, 1963 (LII of 1963), included in the total income, or(ii) in any other case, the earned income included in the total income, exceeds Rs. 1 lakh, a surcharge calculated on the amount of the difference between the income-tax computed in respect of the income referred to in sub-clause (i) or, as the case may be, sub-clause (ii), if such income had been the total income and the income-tax computed in respect of a total income of Rs. 1 lakh, at the following rate, namely :- (1) where the amount of the 5 per cent. of the amount of difference does not exceed such difference; Rs. 65, 000 (2) where the amount of the Rs. 3, 250 plus 10 per cent. difference exceeds Rs. 65, 000 of the amount by which the but not does not exceed Rs. difference aforesaid exceeds 1, 30, 000 Rs. 65, 000; (3) where the amount of the Rs. 9, 750 plus 15 per cent. difference exceeds Rs.1, 30, 000 of the amount by which the difference aforesaid exceeds Rs. 1, 30, 000; and (c) a special surcharge calculated at the rate of ten per cent. on the aggregate of the following amounts, namely :- (i) the amount of income-tax computed in accordance with the proceedings provisions of this Paragraph; and (ii) the aggregate of the amounts of the surcharges calculated in accordance with clause (a) and clause (b) of this sub-Paragraph. on the aggregate of the following amounts, namely :- (i) the amount of income-tax computed in accordance with the proceedings provisions of this Paragraph; and (ii) the aggregate of the amounts of the surcharges calculated in accordance with clause (a) and clause (b) of this sub-Paragraph. "Section 2, sub-section (6), clause (c), of the Finance Act, 1968, states that the expression "earned income" and "unearned income" shall have the meaning respectively assigned to them in clause (c) and clause (f) of sub-section (7) of section 2 of the Finance (No. 2) Act, 1967 * 'Earned income' means any income of an assessee who is an individual, or a Hindu undivided family, or an unregistered firm (not being an unregistered firm assessed under clause (b) of section 183 of the Income-tax Act), or an association of person or body of individuals, whether incorporated or not, not being - (A) a company, or (B) a local authority, or (C) a registered firm, or (D) an unregistered firm assessed under clause (b) of the said section 183 - (i) which is chargeable under the head 'Salaries'; or (ii) which is chargeable under the head 'profits and gains of business or profession' where the business or profession is carried on by the assessee or, in the case of a firm, where the assessee is a partner actively engaged in the conduct of the business or profession; or (iii) which is chargeable under the head 'income from other sources' if it is immediately derived from personal exertion or represents a pension or superannuation or other allowance given to the assessee in respect of the past services of any deceased person, or which is chargeable under that held under clause (ia) of sub-section (2) of section 56 of the Income-tax Act, and includes any such income which, though it is the income of another person, is included in the assessee's total income under the provisions of the Income-tax Act, but does not include any such income on which income-tax is not payable under clause (iii) or clause (v) of section 86 of that Act or which is exempted from tax under a notification issued under section 60 or section 60A of the Indian Income-tax Act, 1922 (XI of 1922), as continued in force by clause (1) of sub-section (2) of section 297 of the Income-tax Act." The income in the present case not having been assessed as salaries and not having been assessed as profits and gains of business or profession, but having been assessed only as income from other sources, it will be "earned income" only if it is immediately derived from personal exertion of the assessee. Mr. Jayaraman, learned counsel for the revenue, contends that the surcharge on earned income being in the nature of a relief given to an assessee, the burden of proving that he was entitled to the relief by showing that the income in question is earned income is on the assessee, and the assessee has not discharged that onus in the present case. We are unable to accepts this argument. Having regard to the provisions of the Finance Act, 1968, which we have extracted, we are of the opinion that there is no question of onus of proof on the assessee either with regard to the earned income or with regard to the unearned income. The statute contemplates the levy of surcharge on the income assesses at different rates depending upon the character of the income as earned or unearned. Consequently, for the purpose of applying the appropriate rate of surcharge, it is for the Income-tax Officer to arrive at a conclusion whether the particular income is earned or unearned, and for the purpose of arriving at such a conclusion necessarily he will have to rely on materials obtained by him. From the very nature of the case, it was for the Income-tax Officer who subjects the income to surcharge at a particular rate, to show why he applied one rate rather than the other. In other words, it is for him to show whether the income is earned income or unearned income for the purpose of applying the particular rate of surcharge. Therefore, having regard to the terms in which the liability to surcharge is imposed by the statute we are of the opinion that the burden is on the department alone to prove whether the particular income is earned income or unearned income for the purpose of applying the relevant rate of surcharge on the same. At no stage, the onus is cast on the assessee to prove that a particular income is earned income and not unearned income simply because the rate of surcharge with regard to unearned income is higher than the rate of surcharge with regard to earned income. The only argument of Mr. Jayaraman is based upon the alleged relief given to an assessee. The only argument of Mr. Jayaraman is based upon the alleged relief given to an assessee. We are of opinion that having regard to the statutory language dealing with the imposition of surcharge, no such question of relief and consequently the onus to obtain that relief on the part of the assessee arises.Even with regard to the merits, as we pointed out already, the contention of the assessee was that he was having agricultural income from his native place and he was also having a business in Ceylon, and the amount seized from his premises constituted the accumulation of the said agricultural income and the business income. This contention of the assessee was not accepted. At the same time, there was absolutely no material to show that the amount in question constituted income received by the assessee from any investments made by him or from any property owned by him. Under these circumstances, the inference drawn by the Tribunal that the amount will constitute income earned by the assessee by personal exertion cannot be said to be erroneous in law. The result is that both the questions referred to this court are answered in the affirmative and against the revenue. The assessee is entitled to his costs. Counsel's fee is Rs. 500 one set.