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TMI Blog1999 (2) TMI 101X X X X Extracts X X X X X X X X Extracts X X X X ..... enalty proceedings under s. 271(1)(c) of the IT Act. He further erred in imposing a penalty of Rs. 3,10,500 on the appellants under s. 271(1)(c) of the IT Act and the learned CIT(A) has erred in confirming the imposition of the said penalty." 3. Shri K. Sampath,C.A.appeared on behalf of the assessee and Shri S.R. Malik, Departmental Representative, appeared for the Revenue. 4. The learned counsel for the assessee submitted that the appellant company derives income from sale and purchase of gold and diamond ornaments. It filed its return of income for the above assessment year31st Dec, 1991, showing a loss of Rs. 39,372. The Department conducted a survey at the business premises of the appellant under s. 133A of the Act on30th Jan., 1992. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s under: "As the assessee has increased his income declared in the original return by Rs. 6 lakhs as per surrender made during the course of survey operation under s. 133A, the books and trading results needs no further comments." 5. The AO has brought no other material on record or any other basis for quantifying this amount of income. 6. In the penalty proceedings the assessee made the following representation: 'In this connection, I may point out that the survey on the business premises of the assessee took place on30th Jan., 1992. The assessee had then addressed a letter to the ITO, Co. Ward 2(1), New Delhi, wherein there was an oral discussion for surrender the additional amount of Rs. 6 lacs in the return of income already filed f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rmed by the CIT(A), on the conclusion that the grant of immunity from penal proceedings is not available in the assessment proceedings from the AO. 8. The learned counsel for the assessee submitted that the offer for surrendering Rs. 6,00,000 as income of the assessee was made when the survey was in progress and not after conclusion of the survey proceedings. Therefore, the admission of the assessee cannot be held to be consequent to material finally detected by the Department. This admission was further coupled with a condition that the penalty will not be levied on the basis of this admission. 9. In addition, the survey was conducted on30th Jan., 1992, and not on30th Sept., 1992, as written in the orders of the lower authorities. Conseq ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... may please be communicated to my client so as to enable him to pay off the full amount within the stipulated time....." "On a plain reading of the said letter and in the light of the aforesaid facts, it is clear that the offer made in the said letter to give up the aforesaid claim was clearly a conditional offer conditioned on the post-assessment penalty levied and leviable being given up. It was urged by Mr. Jetley that this offer must be regarded as an unconditional offer, because it was not within the power of the Dy. CIT to give up the penalty completely, as suggested in the letter and hence the dealer could not have seriously made that offer. In our view, this contention cannot be accepted. That the offer was coupled with the conditio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rely on part of the proposal favourable to it and deny the part of the same proposal which is not favourable to the Revenue. (4) For imposition of penalty merely admission of the assessee in the asst. yr. 1991-92 by itself is not sufficient to sustain the penalty for concealment as imposed. 10. The learned Departmental Representative vehemently argued supporting the orders of the lower authorities. It was vehemently put forth that there cannot be an estoppel against the law and relied on the following case laws: (1) Tube Fabrico (I) Ltd. vs. CIT (1994) 210 ITR 1035 (Del); (2) Sir Shadilal Sugar & Gen. Mills Ltd. & Anr. vs. CIT (1987) 64 CTR (SC) 199 : (1987) 168 ITR 705 (SC); (3) C.B. Bailey vs. Dy. CIT (1998) 66 ITD 1 (Del); and (4) ..... X X X X Extracts X X X X X X X X Extracts X X X X
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