2007 (7) TMI 223 - HC - Income Tax

Findings of fact recorded by the Tribunal shows that the assessee has disclosed all detailed particulars about his income which he has received albeit claiming the same to be gift (received through bank) - case does not fall within the mischief of section 271(1) (c) and it cannot be concluded that the assessee has, furnished incorrect particulars - Even otherwise, no evidence with regard to concealment has been placed on record by the Revenue penalty not sustainable

Summary

Issues:
1. Challenge to order under section 260A of the Income-tax Act, 1961.
2. Imposition of penalty under section 271(1)(c) of the Act.
3. Disclosure of income and particulars by the assessee.
4. Evidence of concealment of income.

Analysis:

1. The Revenue challenged the order of the Income-tax Appellate Tribunal under section 260A of the Income-tax Act, 1961. The Tribunal found that the gift amount claimed by the assessee was received through a banking channel from an identifiable source, Shri Harcharan Singh, and credited to the assessee's account from the NRE Account maintained with the State Bank of Patiala. The Tribunal determined that the Revenue failed to provide evidence of concealment of income or furnishing inaccurate particulars by the assessee, leading to the conclusion that no penalty under section 271(1)(c) of the Act was warranted.

2. The assessee claimed to have received a sum of Rs. 1,00,000 as a gift from Shri Harcharan Singh's NRE Account. The Revenue initiated penalty proceedings under section 271(1)(c) alleging inaccurate particulars or concealment of income. However, the Tribunal, based on precedents including judgments from the Supreme Court and various High Courts, ruled that since the income particulars were declared and the source was identifiable through a banking channel, there was no concealment or furnishing of inaccurate particulars. The Tribunal emphasized that the Assessing Officer's observation alone was insufficient to establish concealment for penalty imposition under section 271(1)(c).

3. The High Court, after considering the arguments, found that no substantial question of law arose for admission of the appeal. The Tribunal's factual findings indicated that the assessee disclosed detailed particulars of the income received, even though claimed as a gift. It was clarified that the case did not fall under section 271(1)(c) as there was no evidence of incorrect particulars or concealment presented by the Revenue. The income transaction was conducted through a banking channel, and the donor's identity was established, despite not being considered a gift. Consequently, the High Court upheld the Tribunal's decision, stating that the appeal lacked merit and was dismissed.