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explanation to section 271(1)(c) of the income-tax act, 1961-penalty-for concealment of income-for assessment year 1963-64, assessee filed return of income on 17-10-1966-ito treated certain cash deposits in assessee's account as income from undisclosed sources and imposed penalty-whether in view of fact that return of income was filed after 1-4-1964, provisions of explanation to section 271(1)(c ) introduced with effect from 1-4-1964 could be invoked for assessment year 1963-64 and penalty imposed-held, yes Facts For the assessment year 1963-64, the assessee filed a return of income on 17-10-1966 showing certain income. The ITO treated certain cash deposits in the assessee's account as income from undisclosed sources and determined the total income of the assessee. The ITO, thereafter, started proceedings under section 271(1)(c) and referred the matter to the IAC who imposed penalty. On appeal, the Tribunal held that since the Explanation to section 271(1)(c) was made applicable with effect from 1-4-1964, that is to say, from the assessment year 1964-65 onwards and had no retrospective operation, the Explanation could not be applied in the instant case and penalty could not be imposed. On reference : Held It has been held by the Supreme Court in the case of Brij Mohan v. CIT [1979] 120 ITR 1, that when a penalty is imposed for concealment of particulars of income, it is the law ruling at the date on which the act of concealment takes place which is relevant. It is wholly immaterial that the income concealed was to be assessed in relation to an assessment year in the past. The concealment of particulars of income is effected by the assessee when the return of income is filed. In the instant case, the return of income was filed on 17-10-1966 and accordingly, the Explanation to section 271(1)(c) introduced with effect from 1-4-1964 would govern the case and thus penalty could be imposed. Therefore, the Tribunal was not justified. Case review Brij Mohan v. CIT [1979] 120 ITR 1 (SC) applied. IT REFERENCE NO. 481 OF 1975. Cases referred to CIT v. Anwar Ali [1970] 76 ITR 696 (SC) and Brij Mohan v. CIT [1979] 120 ITR 1 (SC). JUDGMENT SENGUPTA, J. - In this reference…

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