Law:

Section:

Explanation to section 271(1)(c) [inserted by the Finance Act, 1964, with effect from 1-4-1964] of the Income-tax Act, 1961 - Penalty - For concealment of income - For assessment year 1964-65, assessee filed return on 19-3-1969 showing total income at Rs. 3,300 - Assessment was completed on total income of Rs. 27,503 with a sum of Rs. 24,203 added as assessee's income from undisclosed sources - Whether Explanation added to section 271(1)(c) by the Finance Act, 1964 with effect from 1-4-1964 was attracted inasmuch as return for assessment year 1964-65 was filed on 6-9-1969 and, therefore, penalty under section 271(1)(c) was leviable on assessee - Held, yes Facts For the assessment year 1964-65 the assessee filed his return of income on 19-3-1969 showing a total income of Rs. 3,300. During the assessment proceedings the assessing authorities found that the assessee had an additional income of Rs. 24,203 from undisclosed sources which was not shown in the return. After completing the assessment on a total income of Rs. 27,503, the ITO initiated penalty proceedings and even- tually levied a penalty by invoking the provisions of the Explanation to section 271(1)(c) added by the Finance Act, 1964 with effect from 1-4-1964. The Tribunal deleted the penalty and the revenue's contention that the Explanation added to section 271(1)(c), was clearly attracted and in view of that Explanation, burden was on the assessee to prove that failure to return the correct income did not arise from any fraud or any gross or willful neglect on his part and that on his failure to discharge this burden, he will be deemed to have concealed the particulars of his income or furnished inaccurate particulars of such income for the purposes of section 271(1)(c). On reference: Held It has been held by the Supreme Court in the case of Brij Mohan v. CIT [1979] 120 ITR 1 that since penalty is imposed on account of the commission of a wrongful act, it is plainly the law operating on the date on which the wrongful act is committed which determines the penalty. Consequently, where penalty is imposed for concealment of particulars of income it is law ruling on the date when the act of concealment…

Deprecated: trim(): Passing null to parameter #1 ($string) of type string is deprecated in /home/digixyei/sldsystempk.com/view/master-layout/view_case.php on line 492