1993 (3) TMI 136 - AT - Income Tax

Summary

Issues Involved:
1. Penalty u/s 271(1)(c) for concealment of income.
2. Penalty u/s 273(2)(c) for failure to furnish an estimate of advance tax.

Summary:

Penalty u/s 271(1)(c) for Concealment of Income:
The assessee filed original and revised returns for the assessment years 1979-80 and 1980-81, declaring higher incomes in the revised returns. The revised returns were filed under the Amnesty Scheme to buy peace and avoid litigation. The Income Tax Officer (ITO) found that the assessee had concealed income from undisclosed sources and levied penalties u/s 271(1)(c). The CIT(A) upheld these penalties, rejecting the assessee's contention that the disclosures were voluntary under the Amnesty Scheme. The Tribunal's Judicial Member agreed with the CIT(A), noting that the revised returns were filed only after the ITO had repeatedly requested evidence to prove the genuineness of the loans, indicating that the disclosures were not voluntary. The Accountant Member, however, disagreed, arguing that the revised returns were filed under the Amnesty Scheme to avoid litigation and that the department had not conclusively proved concealment. The Third Member sided with the Judicial Member, concluding that the revised returns were not voluntary and that the department had sufficient material to detect concealment, justifying the penalties.

Penalty u/s 273(2)(c) for Failure to Furnish an Estimate of Advance Tax:
As a natural corollary to the findings on penalties u/s 271(1)(c), the penalties u/s 273(2)(c) were also upheld. The Tribunal's Judicial Member maintained that the penalties were justified given the concealment of income. The Accountant Member, however, argued that the returns were revised under the Amnesty Scheme and that the penalties should be canceled. The Third Member agreed with the Judicial Member, concluding that the CIT(A) was justified in upholding the penalties u/s 273(2)(c) as well.

Final Decision:
The Third Member's opinion led to the conclusion that the CIT(A) was justified in upholding the penalties imposed u/s 271(1)(c) and u/s 273(2)(c) for the assessment years 1979-80 and 1980-81. The appeals were dismissed.