Law:

Section:

Section 271(1)(c) read with Explanation thereto [as it stood prior to 1-4-1976] of the Income-tax Act, 1961 - Penalty - For concealment of income - Because of difference of more than 20 per cent between returned sum and assessed sum IAC imposed penalty for concealment of income - Tribunal, however, cancelled holding that assessee had discharged onus and also refused to make a reference under section 256(1) -On reference under section 256(2) at instance of revenue, assessee produced Tribunal's order in appeal against assessment showing that Tribunal had allowed substantial relief to assessee with result that assessee's returned income was not less than 80 per cent of assessed income - Whether in view of Tribunal's order in assessment appeal, Tribunal had to reconsider its decision in penalty appeal - Held, on facts, yes Facts A difference of more than 20 per cent having been found between the amount returned by the assessee and the amount assessed, the ITO was of the view that there had been concealment of income by the assessee and penalty was, accordingly imposed. On appeal, the Tribunal set aside the penalty order on the ground that the assessee's assertion in regard to his return was sufficient to discharge the onus. The Tribunal further refused to make reference under section 256(1). On reference under section 256(2), the assessee produced the Tribunal's order in appeal against assessment showing that substantial relief had been given to the assessee and the assessee's returned income was not less than 80 per cent of the assessed sum. Held It appeared that the Tribunal gave some relief to the assessee in terms of which the assessable amount had fallen and the gap between the assessed sum and the returned sum was less than 20 per cent. The case had thus assumed a different complexion. Therefore, the question of penalty required fresh consideration. The matter was, accordingly, remanded back to the Tribunal to dispose of the appeal in accordance with the law on the basis of the finally assessed sum. Case referred to Hindustan Steel Ltd. v. State of Orissa [1972] 83 ITR 26 (SC). B.P. Rajgarhia and S.K. Sharan for the Applicant. Rameshwar Prasad and Bipin…

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