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Section 271(1)(c) of Income-tax Act, 1961 – Penalty – For concealment of income – Assessment year 1964-65 – ITO having found cash credits in assessee's accounts with no satisfactory explanation made addition in assessee's income and imposed penalty – Tribunal deleted penalty on ground that revenue had not discharged its burden of providing concealment of income by assessee – Whether Explanation added to section 271(1)(c) applies to penalty proceedings from assessment year 1964-65 onwards and in cases covered by Explanation, it raises three-fold presumption-one of concealment, other of in accurate particulars and third, amount so concealed or in respect of which inaccurate particulars had been furnished, is 'income' of assessee – Held, yes – Whether such presumption is rebuttable by assessee proving that failure to return correct income was not due to fraud or gross or wilful negligence on his part – Held, yes – Whether, therefore, it was incorrect on part of Tribunal to place burden of proof on revenue, and, consequently, cancellation of penalty was not justified – Held, yes FACTS For the relevant assessment year the ITO having found certain cash credits in the assessee's accounts for which no satisfactory explanation was forthcoming made addition as income from undisclosed sources. The addition was sustained by the Tribunal. On the above basis, the IAC imposed penalty under section 271(1)(c ). On appeal, the Tribunal cancelled the penalty on the ground that the revenue had to prove the charge of concealment or even of furnishing of inaccurate particulars failing which the penalty did not become exigible. On reference: HELD In CIT v. Anwar Ali [1970] 76 ITR 696 (SC), the Supreme Court dealt with the penalty, proceedings for the year 1947-48 under section 28(1)(c ) of the 1922 Act, which was in pari-materia with section 271(1)(c) as it stood prior to its amendment in 1964. By the amendment of 1964, the word ‘deliberately' was omitted from the phrase ‘has concealed the particulars of income or deliberately furnished inaccurate particulars of such income' occurring in clause (c). Further, an Explanation was added. For the assessment year 1964-65 onwards…

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