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2019 (7) TMI 606 - MADRAS HIGH COURTLevy of penalty u/s 271(1)(c) - rejection of claim of sundry creditors which were offered for taxation in the course of the assessment proceedings by the Appellant - concealment of Income or furnishing of inaccurate particulars of Income - penalty imposed by AO, deleted by the CIT(Appeals) and restored by the Tribunal in the impugned order is warranted - HELD THAT:- In the instant case, there was no allegation made against the assessee that the statement given by the assessee was either mala fide or lacks bona fide. There is no allegation against the assessee that he suppressed information to the Department with an intent to evade payment of tax. The details called for by the Assessing Officer during the course of assessment proceedings were culled out from the books of the assessee. In similar circumstances, this Court in Sree Krishna Electricals Vs. State of Tamil Nadu [2009 (4) TMI 428 - SUPREME COURT] held that penalty was not imposable under the provisions of the Tamil Nadu General Sales Tax Act, when the details were culled out from the books of accounts of the assessee/dealer. If the assessee gives an explanation which is unproved but not disproved i.e., it is not accepted but circumstances do not lead to the reasonable and positive inference that the assessee's case is false. The explanation cannot help the Department because there will be no material to show that the amount in question was the income of the assessee. In Commissioner of Income Tax Vs. Suresh Chandra Mittal [1999 (7) TMI 34 - MADHYA PRADESH HIGH COURT] it was held that the burden shifts to the assessee only if he fails to offer any explanation for the undisclosed income or offers explanation, which is found to be false by the Assessing Officer. However, proviso to Explanation 1 provides for shifting of this burden again where the explanation offered by the assessee is found to be bona fide. In the instant case, the explanation offered by the assessee was not found to be false by the Assessing Officer, in fact, the reconciliation made by the assessee was accepted for the amount of ₹ 34,51,447/-. The decision in Suresh Chandra Mittal (supra) was affirmed by the Hon'ble Supreme Court [2001 (6) TMI 63 - SC ORDER] Tribunal was wrong in reversing the order passed by the CIT(A), which deleted the penalty imposed on the assessee. - Decided in favour of assessee.
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