Law:

Section:

Section 271(1)(c) of the Income-tax Act, 1961 (Corresponding to section 28(1)(c) of the Indian Income-tax Act, 1922) - Penalty - For concealment of income - Assessment years 1945-46 and 1946-47 - Assessee started his business of colliery for first time in accounting year 1944 - In accounts maintained for that year assessee did not bring into account value of closing stock and same method was repeated in subsequent accounting year - It was found that assessee's system of accounting was neither cash nor mercantile but hybrid system of both - ITO estimated value of closing stock and holding that there was deliberate omission on part of assessee to disclose value of closing stock, imposed penalty upon assessee under section 28(1)(c) of 1922 Act - Tribunal remarked in its appellate order that two accounting years were first two years of independent business of assessee and he was following practice followed in other firms wherein he had been partner - Whether, on facts, department had not discharged onus of showing that assessee was guilty of concealment of particulars of his income or deliberately furnishing inaccurate particulars of such income - Held, yes - Whether, failure of assessee to disclose value of closing stock was not tantamount to concealment or deliberate furnishing of inaccurate particulars within meaning of section 28(1)(c) of 1922 Act and therefore, penalty imposed upon him was not legally valid - Held, yes FACTS The assessee was a proprietor of a colliery. The business was started by the assessee for the first time in the accounting year 1944. When the accounts were made up for that year the assessee did not bring into account the value of the closing stock of the coal extracted. The same method was repeated in the accounting year 1945. The ITO estimated the closing stock for these two accounting years and completed the assessments. Thereafter, the ITO holding that there was deliberate omission on the part of the assessee to disclose the value of the closing stock, imposed a penalty upon the assessee for both the accounting years under section 28(1)(c) of the 1922 Act. The assessee's appeal before the AAC was dismissed. On further appeal, the…

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