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JUDGMENT Challa Kodanda Ram, J. - At instance of the Revenue, the below mentioned question of law, which arises from the order dated August 7, 1995, of the Tribunal in I.T.A. No. 376/Hyd/90 for the assessment year 1982-83, has been referred for opinion of this court. "Whether, on the facts and in the circumstances of the case, the Income-tax Appellate Tribunal is justified in upholding the levy of maximum penalty of Rs. 10.50 lakhs and whether the Tribunal's findings are vitiated by non-consideration of the relevant factors?" 2. Heard Sri Ch. Pushyam Kiran, learned counsel for the assessee and Sri S.R. Ashok, learned senior counsel for the Income-tax Department. 3. After perusing the orders of the Tribunal and hearing both the learned counsel, we deem it appropriate to reframe the question of law as under : "(1) Whether, on the facts and in the circumstances of the case, the Tribunal is justified in upholding the levy of maximum penalty under section 271(2) of the Income-tax Act, 1961, on account of the issue relating to concealment of refundable empty bottle deposit and the Tribunal's findings are vitiated by non-consideration of the relevant factors ? (2) Whether, on the facts and in the circumstances of the case, the Tribunal is justified in upholding the maximum penalty arising on account of unreconciled difference in the balance-sheet and the Tribunal's findings are vitiated by non-consideration of the relevant factors ?" 4. The assessee is carrying on the business of liquor. For the assessment year 1982-83, the assessee was levied with penalty under section 271(2) of the Income-tax Act, 1961 (for short "the Act") for concealment of income amounting to Rs. 8,29,966 on three counts as mentioned below : (a) Refundable empty bottle deposit Rs. 5,19,329 (b) Packing and servicing charges Rs. 1,26,096 (c) Unreconciled difference in the balance-sheet Rs. 1,84,541 Total Rs. 8,29,966 The assessee's appeal before the Commissioner came to be allowed in part. Out of the three items mentioned above, the assessee himself agreed to the penalty on packing and servicing charges and paid the penalty. The assessee's explanation was accepted by the first appellate authority…

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