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TMI Blog2004 (1) TMI 336X X X X Extracts X X X X X X X X Extracts X X X X ..... case of Harigopal Singh vs. CIT [ 2002 (8) TMI 65 - PUNJAB AND HARYANA HIGH COURT] , held that there was a difference of opinion as regards the estimate of income of the assessee. Since the AO and the Tribunal adopted different estimates in assessing the income of the assessee, it could not be said that the assessee had concealed the particulars of income so as to attract cl. (c) of s. 271(1) . The ratio of above decision laid down by the Punjab Haryana High Court is squarely applicable to the facts of the present case, therefore, the learned CIT(A) was justified in deleting the penalty. A similar view has been taken by the Madras High Court in the case of CIT vs. Smt. K. Meenakshi Kutty[ 2002 (8) TMI 86 - MADRAS HIGH COURT] by holding that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ct to depreciation and interest to third parties. The AO had imposed the penalty holding the difference of income as computed on the basis of the decision of the Tribunal in case of the assessee and income as shown by the assessee as concealed income. The difference of income was computed at Rs. 1,94,900 and the same was considered as the concealed income of the assessee. Consequently the penalty of Rs. 86,401 was imposed. 3. The assessee carried the matter to the CIT(A) and stated that the AO was not legally justified in imposing the penalty because the assessee had not concealed its income in any manner. It was stated that the original return was revised with a view to include the income of the minor children. It was stated that the asses ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on of a particular flat rate and it did not amount to concealment of income. He, therefore, following the decision of Tribunal, Jaipur Bench in case of Asstt. CIT vs. Milap Textile Mills and the judgment of Hon ble Allahabad High Court in case of CIT vs. K.L. Mangal Sain held that the AO was not justified in imposing the penalty. Accordingly the penalty was cancelled. 5. Now the Department is in appeal. The learned Departmental Representative stated that the addition in the income of the assessee had been confirmed up to the Tribunal level, therefore, it was the clear case of concealment by the assessee and the penalty was rightly levied by the AO and the CIT(A) was not justified in deleting the same. In his rival submissions, the learned c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... by the AO that the assessee concealed any particulars of income or furnished inaccurate particulars of income. Their Lordships in the case of Shiv Lal Tak vs. CIT at p. 381 observed that: "In making computation of total income where the income returned has been rejected by rejecting the trading results, finding some discrepancy in the books of account and substituting the same by an estimated figure, in the strict sense, can neither be said to be addition of any amount in the returned income nor disallowance of any amount as deductions claimed. The word "amount" of which additions made or deductions disallowed also denotes reference to specific item of amount added or disallowed as deduction in contrast to substitution of altogether a new e ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the income of the assessee, it could not be said that the assessee had concealed the particulars of income so as to attract cl. (c) of s. 271(1)". The ratio of above decision laid down by the Punjab Haryana High Court is squarely applicable to the facts of the present case, therefore, the learned CIT(A) was justified in deleting the penalty. A similar view has been taken by the Madras High Court in the case of CIT vs. Smt. K. Meenakshi Kutty (2003) 180 CTR (Mad) 190 : (2002) 258 ITR 494 (Mad) by holding that the Tribunal had clearly held that the estimate given by the assessee was not the result of any gross or wilful negligence and that penalty was not called for. The cancellation of penalty was valid. 9. In view of the aforesaid discussi ..... X X X X Extracts X X X X X X X X Extracts X X X X
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