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Issues:
Assessment of undisclosed income, penalty for concealment, applicability of penalty laws. Analysis: The case involved assessment years 1965-66, 1966-67, and 1967-68, where the appellant, a bus owner, had undisclosed income. The Income-tax Officer reopened the assessment based on information from a lawsuit revealing the appellant's undisclosed income of Rs.1,38,000. The appellant sought to spread this income over three years, but the Officer assessed Rs.30,000 as unexplained investment for 1965-66, initiating penalty proceedings for concealment. The Inspecting Assistant Commissioner found the appellant deliberately concealed income and imposed penalties of Rs.30,000 for each year, totaling Rs.95,000. The appellant appealed the penalty orders, arguing that since the civil court dismissed the suit related to the undisclosed income, no concealment existed. However, the Tribunal rejected this argument, emphasizing the appellant's admission of concealment before the Income-tax Officer. The Tribunal also considered the law applicable at the time of filing original returns, reducing the penalties based on pre-amendment penalty laws. Citing a relevant case, the Tribunal held that penalties should align with the laws in force when the original returns were filed, directing a revision of penalties accordingly. Ultimately, the appeals were partly allowed, with the Tribunal adjusting the penalties based on the laws prevailing at the time of filing the original returns. The excess amounts collected as penalties were to be refunded to the appellant, in line with the revised penalty laws. This detailed analysis covers the issues of assessment of undisclosed income, penalty for concealment, and the applicability of penalty laws in the context of the appellant's case before the Appellate Tribunal ITAT HYDERABAD-A.
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