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Issues involved: Appeal against deletion of penalty u/s 271(1)(c) of the Income-tax Act, 1961.
Summary: The appeal was filed by the revenue against the deletion of a penalty of Rs. 4,00,000 imposed by the Assessing Officer u/s 271(1)(c) of the Income-tax Act, 1961. The case involved an assessee company, a subsidiary of a corporation in Canada, which filed its return of income and later a revised return. The penalty was initiated for furnishing inaccurate particulars of income. The CIT(A) cancelled the penalty after considering the submissions and legislative history of the section, emphasizing the need for a deliberate attempt to conceal income. The Tribunal reviewed the case laws and provisions of section 271(1)(c) to determine the applicability of the penalty. The Tribunal noted that the penalty under section 271(1)(c) is leviable if the Assessing Officer is satisfied that the person concealed income or furnished inaccurate particulars. The Explanation 1 to the section deals with situations where the assessee fails to offer a valid explanation or fails to substantiate it. The Tribunal emphasized that the presumption of concealment under Explanation 1 is rebuttable and not conclusive. The onus is on the assessee to prove no concealment took place. In line with legal precedents, the Tribunal held that the mere confirmation of additions in assessment does not automatically imply concealment or inaccurate particulars by the assessee. The Tribunal referenced cases where penalties were not justified when additions were made on an estimate basis. Upholding the CIT(A)'s decision, the Tribunal dismissed the revenue's appeal and deleted the penalty. Judgment by Tribunal: The Tribunal upheld the CIT(A)'s decision to delete the penalty u/s 271(1)(c) after considering the legislative history, provisions of the Act, and legal precedents. The Tribunal emphasized the need for a deliberate attempt to conceal income and the rebuttable nature of the presumption under Explanation 1. The Tribunal concluded that the penalty was not justified based on the facts of the case and legal interpretations.
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