Law:

Section:

Section 271(1)(c) of the Income-tax Act, 1961 - Penalty - For concealment of income - Assessment years 1962-63 to 1967-68 and 1969-70 - During course of assessment proceedings, inflations in revenue account and omission in sales came to light - Assessee admitted that there had been escapement of income for relevant assessment years - IAC levied penalty under section 271(1)(c) - Tribunal upheld penalty order, but as regards assessment year 1969-70, it concluded that concealment of income was not proved, and therefore, no penalty was exigible - Whether initial burden of proof is cast on assessee to displace presumption of concealment of income - Held, yes - Whether question as to whether burden of proof has been discharged on a set of facts, is also a question of fact - Held, yes - Whether, therefore, when Tribunal on preponderance of probability, held that assessee had discharged burden cast on him and had proved that failure to return correct income did not arise from any act of omission or commission on his part as envisaged under section 271(1)(c), it was justified in concluding that no penalty was exigible in instant case - Held, yes FACTS During the course of the assessment proceedings, inflations in the revenue account and omission in sales came to light. The assessee admitted that there had been escapement of income for the relevant assessment years and a sum of Rs. 4,84,348 was conceded as the concealed income. Accordingly, revised returns were filed. For the assessment year in question (1969-70), the revised income returned was Rs. 2,35,637. On the basis of the revised return and after making an addition for sales tax refund claim, the ITO fixed the total income at Rs. 3,24,929. In penalty proceedings under section 271(1)(c), the IAC held that the escaped income relating to the assessment year 1969-70 was Rs. 45,329 and levied a penalty of Rs. 45,400. On appeal the Appellate Tribunal held that for the years 1962-63 to 1967-68, there was ample evidence to show that the assessee had concealed income. The levy of penalty for the said years was upheld. At the same time, the Tribunal came to the conclusion that the position was slightly different in the…

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