Law:

Section:

Section 271(1)(c) of the Income-tax Act, 1961 - Penalty - For concealment of income - Assessment year 1969-70 - Whether where there was no material except fact that explanation offered by assessee was rejected, Tribunal was legally justified in cancelling penalty imposed under section 271(1)(c) - Held, yes FACTS The ITO completed the assessment after making additions on the ground that certain cash credits were not properly explained by the assessee. Penalty proceedings were also initiated under section 271(1)(c), and the IAC imposed certain penalty. On appeal, the Tribunal held that merely because the explanation offered by the assessee was rejected, it furnished no ground for levying penalty until and unless it was found that the amount in question constituted the concealed income of the assessee. Since there was no material except the fact that the explanation offered by the assessee was rejected, the Tribunal held that the imposition of penalty was not warranted. On reference : HELD In view of the decision of the Supreme Court in CIT v. Anwar Ali [1970] 76 ITR 696, the Tribunal was legally justified in cancelling the penalty imposed under section 271(1)(c ). Note : The case has been decided in favour of the assessee. CASE REVIEW CIT v. Anwar Ali [1970] 76 ITR 696 (SC) followed and relied upon. CASES REFERRED TO CIT v. Anwar Ali [1970] 76 ITR 696 (SC). JUDGMENT B.P. Jeevan Reddy, CJ. - The Income-tax Appellate Tribunal has referred the following question under section 256(2) of the Income-tax Act, 1961. "Whether, on the facts and in the circumstances of the case, the Tribunal was legally justified in cancelling the penalty imposed under section 271 (1)(c) of the Income-tax Act, 196] ?" The relevant facts are the following : The assessee is a registered firm. For the assessment year 1969-70, it filed a return disclosing an income of Rs. 14,860 The Income-tax Officer, however, assessed its total income at Rs. 47,981. He did so on the ground that certain cash credits were not properly explained by the assessee. Penalty proceedings were also initiated under section 271(1)(c). Since the minimum penalty imposable exceeded the sum of Rs. 1,000, the matter was…

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