9911796707
TMI Blog1977 (7) TMI 80X X X X Extracts X X X X X X X X Extracts X X X X ..... the recovery of a sum of Rs.1,38,000. as the income escaped assessment, the assessment was re-opened. The assessee wanted this income to be spread over 3 years after giving set off to intangible additions made in earlier years. The Income-tax Officer had given a set off of Rs.1,00,000 as the income from undisclosed source for the following three years: 1965-66 Rs. 30,000 1966-67 Rs. 35,000 1967-68 Rs. 35,000 The Income-tax Officer, therefore, assessed income of Rs. 30,000 as the unexplained investment under "other sources" for the asst. yr. 1965-66 and also initiated penalty proceedings for concealment. As the minimum penalty imposable exceeded Rs. 25,000 the case was referred to the In ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nt by his father which as alleged by him that he came to know subsequent to his father's death. In the plaint the assessee had clearly stated that the amount of Rs. 1,38,000 was lent by him to Shri L.V. Ramana Reddy on 10th Feb., 1969 when a pronote was executed. The plea that the assessee was not aware of part of the transaction is therefore incorrect inasmuch as the entire amount was lent by the assessee himself and the evidence available on record can easily disprove the contention of the assessee. Lower down it was further observed: "The assessments were re-opened by issue of notice under s. 147 r/w s. 148 on 16th Mach., 1974 and in response to these notices, the assessee chose to file the returns on 27th March, 1974 disclosing the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... including costs and the said amount is received in cash today by the plaintiff from the defendant. The said claim may, therefore, be recorded as satisfied. In regard to the promissory note dt. 10th Feb., 1969, for Rs.1,38,000 denied by the defendant, the suit may be dismissed without costs"; the Court doth order and decree that the suit be and the same is hereby dismissed and that the plaintiff and the defendant do bear their own costs of this suits." Basing himself on this decree passed by the Civil Court, the learned counsel has contended that since the suit was ultimately dismissed, the question of concealment did not arise so as to attract the levy of penalty. We find overselves unable to accept this contention. Firstly, the decree of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e income the Inspecting Assistant Commissioner levied penalty. Regarding quantum, the Inspecting Assistant Commissioner applied the provisions of s. 271(1)(c) as amended w.e.f. 1st Aplril, 1968, and levied Rs. 1,800 per year. In appeal, the Tribunal while holding on merits that the assessee was liable for penalty, held that on the question of quantum, the law as it stood prior to 1st April, 1968, is applicable, as the original returns concealing income were filed prior to 1st April, 1968. On a reference at the instance of the Commissioner, the Andhra Pradesh High Court held that the law applicable to the mode and manner of levy of penalty is the law which was in force as on the date of commission of offence or contravention of a particular ..... X X X X Extracts X X X X X X X X Extracts X X X X
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