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Issues:
1. Condonation of delay in filing appeal. 2. Escaped income assessment and addition of income. 3. Penalty imposition under section 271(1)(c) for concealment of income. 4. Appeal against penalty imposition. 5. Justification for penalty cancellation based on legal precedents. Detailed Analysis: 1. The appeal was filed late by two days, and the assessee sought condonation of delay due to incorrect advice from the counsel regarding the filing deadline. The Tribunal considered the circumstances and condoned the delay, noting that while counsel's advice may not always justify delay, in this case, it was accepted. 2. The case involved the reassessment of the assessee's income for the assessment year 1966-67. The Income Tax Officer (ITO) initiated reassessment proceedings after discovering undisclosed property purchase information. The assessee explained the source of funds, but the ITO added Rs. 12,500 to the income, totaling it to Rs. 22,121. No appeal was filed against this assessment. 3. Penalty proceedings under section 271(1)(c) were initiated based on the addition to income. The assessee argued against penalty imposition citing previous judgments, but the ITO imposed a penalty of Rs. 12,500. The appeal to the Appellate Authority was unsuccessful as the penalty was confirmed. 4. The assessee appealed against the penalty imposition to the Appellate Authority Commissioner (AAC), who upheld the penalty citing discrepancies in explanations and lack of specific evidence supporting the source of funds used for property purchase. 5. The Tribunal considered the submissions from both parties regarding penalty imposition. The assessee argued that the addition to income was agreed upon to avoid hassle and maintain peace, invoking legal precedents to support penalty cancellation. The Tribunal analyzed various judgments cited and concluded that the penalty was not justified in this case. The Tribunal highlighted that the agreement to the addition did not automatically warrant penalty imposition, especially considering the circumstances and explanations provided by the assessee. In conclusion, the Tribunal allowed the appeal, canceling the penalty imposed under section 271(1)(c) based on the preponderance of probability favoring the assessee and the lack of evidence supporting concealment of income. The Tribunal differentiated this case from previous judgments cited by the Departmental Representative, ultimately ruling in favor of the assessee.
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