Law:

Section:

SECTION 271(1)(c ) OF THE INCOME-TAX ACT, 1961 - PENALTY - FOR CONCEALMENT OF INCOME - FOR ASSESSMENT YEAR 1963-64, ASSESSEE HAD DECLARED A SUM AS INCOME AND ORIGINAL ASSESSMENT WAS COMPLETED ON A SLIGHTLY HIGHER INCOME - LATER, IN A VOLUNTARY DISCLOSURE UNDER SECTION 271(4A), IT ADMITTED THAT ITS ACCOUNTS WERE FALSE AND THAT ITS INCOME WAS IN EXCESS OF THAT ORIGINALLY RETURNED AND ASSESSED - NEVERTHELESS, IN RESPONSE TO NOTICE UNDER SUCTION 148, ASSESSEE AGAIN FILED A RETURN SHOWING ABOUT SAME INCOME ON WHICH ORIGINAL ASSESSMENT WAS MADE - LATER BEFORE ITO COMPLETED REASSESSMENT, ASSESSEE FILED A REVISED RETURN DISCLOSING INCOME ON THE BASIS OF THE DISCLOSURE PETITION - WHETHER ON ASSESSEE'S OWN SHOWING IT WAS A CASE OF DELIBERATE CONCEALMENT AND HENCE PENALTY WAS LEVIABLE UNDER SECTION 271(1)(c) NOTWITHSTANDING THE FACT THAT HE HAD FILED REVISED RETURN SHOWING CORRECT INCOME BEFORE COMPLETION OF ASSESSMENT - HELD, ON FACTS, YES FOR ASSESSMENT YEAR 1964-65, ASSESSES HAD DECLARED ITS PROFITS DERIVED FROM SALE OF IMPORT LICENCES ON AN ESTIMATED BASIS IN REVISED RETURN - ITO ESTIMATED PROFITS AT A HIGHER FIGURE - WHETHER SINCE ASSESSEE HAD DISCLOSED THE SOURCE OF INCOME AND ITS DISCLOSURE WAS FULL AND VOLUNTARY AND THERE WAS NO ELEMENT OF FRAUD AND NEGLECT IN ASSESSEE'S CONDUCT, PENALTY UNDER SECTION 271(1)(c) WAS NOT LEVIABLE ON ASSESSEE EVEN THOUGH ITO HAD ESTIMATED INCOME AT A HIGHER FIGURE - HELD, ON FACTS, YES Facts For the assessment year 1963-64, the assessee disclosed only an income of Rs. 47,086 making it appear that income was derived by it from the business of manufacturing finished textile goods from out of art-silk yarn imported from abroad by utilisation of import permits. The assessment was completed by the ITO on a total income of Rs. 52,014 after some miscellaneous additions were made to the income returned. Subsequently, the assessee filed a petition before the Commissioner under section 271(4A) disclosing income in excess of that already assessed. It was also admitted that far from utilising the imported art-silk yarn or manufacturing finished textiles, the assessee had trafficked in the import licences as such on resale of the imported yarn…

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