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Issues:
Imposition of penalties under section 271(1)(c) of the IT Act for the assessment years 1993-94 and 1994-95. Analysis: The appeals under consideration were related to the imposition of penalties under section 271(1)(c) of the IT Act for the assessment years 1993-94 and 1994-95. The assessee, engaged in the business of publishing pre-share issue stationery, had surrendered additional incomes during a survey operation conducted in 1996. The penalties were imposed based on the grounds that the surrendered income constituted concealed income. However, it was noted that no penalty was imposed for the assessment year 1995-96, despite similar facts. The tribunal found it perplexing that penalties were imposed for certain years while dropped for others without any distinguishing features being pointed out. The tribunal highlighted that the mere surrender of income during a survey does not automatically indicate concealment of income. The explanations provided by the assessee regarding the additional income were disregarded by the authorities below. The tribunal concluded that the penalties imposed were not sustainable in law and decided to delete the penalties imposed for the assessment years 1993-94 and 1994-95, providing relief to the assessee. In conclusion, the tribunal allowed both appeals, emphasizing that the imposition of penalties based solely on the surrender made during a survey operation was not justified. The tribunal held that the mere surrender of income does not establish concealment of income, and the explanations provided by the assessee were not properly considered by the authorities. Therefore, the tribunal deemed it appropriate to delete the penalties imposed for the respective assessment years, providing relief to the assessee.
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