Law:

Section:

Section 271(1)(c) of the Income-tax Act, 1961 - Penalty - For concealment of income - Whether mere filing of a revised return would exonerate assessee from liability to penalty - Held, no - Whether filing of revised return after coming to know of departmental investigations would amount to 'voluntary' filing of revised return by assessee so that penalty would not be leviable - Held. no - Whether where assessee omitted to return share income from firm while filing original return but returned in the revised return, and share income finally assessed was more than such returned income, tribunal would be justified in linking quantum of penalty with portion of share income concealed in revised return, instead of entire share income - H eld, no Facts For the assessment years 1966-67, and 1967-68, the assessee filed the original returns on 26-6-1968. In the meantime, the department was conducting enquiries in respect of the assessment for the assessment year 1964-65 reopened by a notice under section 148 on 20-7-1965 and had got information about some shady activities of the assessee. On 30-1-1971, the assessee filed revised returns for the assessment years 1966-67 and 1967-68 showing the incomes at much higher figures than those returned in the original return. The revised returns showed income from cloth business, contract business and the share of profit from a certain firm K. the ITO completed the assessment and also initiated penalty proceedings under section 271(1)( c) for concealment of income with reference to the original returns. The assessee contended, inter alia, (i) that inasmuch as the return had been revised and that the assessment had been completed on the basis of the revised return, no penalty was called for when no concealment was established with reference to the revised return; and (ii) that he was illiterate and could not get proper advice while filing original return. The IAC held that there was no justification for not imposing penalty only on the ground that a revised return had been filed subsequently. He also held that the assessee was a man well experienced in business and at any rate he could not have been ignorant of the PWD contracts…

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