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TMI Blog1983 (9) TMI 151X X X X Extracts X X X X X X X X Extracts X X X X ..... s unexplained investment and initiated penalty proceedings under section 271(1)(c) of the Income-tax Act, 1961 ('the Act'). In response to the show-cause notice the assessee neither attended nor filed any reply. At the time of original assessment also, the assessee had neither produced the creditors nor filed any documentary evidence in support of their statements, He, therefore, levied a penalty of Rs. 8,500 for concealment under section 271(1)(c). The same has been confirmed by the AAC on appeals. The assessee has consequently come up in second appeal before us. 2. We have heard the representatives of the parties at length in this appeal. The assessee's case as put forth by Mr. Purohit was that apart from holding that these cash credits ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ation was not strictly mentioned by the ITO in his order levying the penalty but it is well settled principle of law that all rebuttable presumptions fall within the realm of rule of evidence. Even if the penalty proceedings have been initiated by the ITO without resorting to the Explanation, the same can be looked into by the IAC or higher authorities. Reference may be made to the decision of the Gujarat High Court in CIT v. Drapco Electric Corpn. [1980] 122 ITR 341. In this case penalty deleted by the Tribunal was ordered to be restored by the High Court on the ground that the assessee had failed to return the correct income and to displace the presumption raised against him on the basis of preponderance of probabilities either by leading ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... been laid down that although the circumstances under which penalty could be levied could not be considered in the assessment proceedings and different interpretation could be put on those circumstances because the assessee can come with fresh evidence in the penalty proceedings to show that the failure to return the correct income was not due to any fraud or any gross or wilful neglect on his part but where the assessee produced no fresh evidence or presented no additional or fresh circumstances in the penalty proceedings, he should be deemed to have failed to discharge the onus placed on him by the Explanation to section 271(1)(c) and the levy of penalty on him would be valid. Lastly, we may refer to the recent decision of the Full Bench ..... X X X X Extracts X X X X X X X X Extracts X X X X
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