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TMI Blog1989 (2) TMI 173X X X X Extracts X X X X X X X X Extracts X X X X ..... the amount to tax with an express condition that it will not attract any penalty and that there was no admission that this was the income of the assessee. Moreover, this was not a case of reopening u/s 147 at all. Therefore, there could be no inference that there was concealment. The Department has come up in second appeal before the Tribunal. 3. In ITA No. 86 (Nag)/86 a similar addition of Rs. 8,000 on account of extra household expenditure was made by the ITO on the assessee's filing a revised return on 23-3-1984. Of course in this case the assessment had not been completed in the first instance but otherwise the facts are same. The ITO levied a penalty on the basis of assessee's admission of extra income and the AAC similarly deleted the penalty because according to him, the ITO had not rebutted the explanation of the assessee that the revised return had been filed without any material in the possession of the ITO about the household expenses. The Department is in appeal before the Tribunal in this case. 4. In ITA No. 87 (Nag)/86 again the facts are similar. The return was filed at Rs. 23,910. Thereafter additional income of Rs. 8,000 was shown in respect of cash represente ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... efore the Tribunal. 6. In ITA No. 103 (Nag)/86 the return of income was originally filed at Rs. 27,440 and assessment was also completed u/s 143(1) at this figure. Thereafter additional income of Rs. 8,000 under the head "income from other sources" was declared and on this additional income a penalty of Rs. 4,122 has been levied. This has been confirmed by the AAC and consequently the assessee is in appeal. 7. In ITA No. 104 (Nag)/86 the facts are that on a search operation it was found that the assessee, a minor, had purchased FDR of Rs. 50,000. The sources were sought to be explained in section 132(5) proceedings. Though they were explained, the assessee offered Rs. 25,000 for taxation only in order to purchase peace. The ITO initiated penalty proceedings and ultimately came to the conclusion that the assessee had concealed his income within the meaning of Explanation (3) to section 271(1)(c). He, therefore, levied a penalty of Rs. 7000. This has been confirmed by the AAC and the assessee has consequently come up in second appeal before the Tribunal. 8. In ITA No. 106 (Nag)/86 the original assessment was completed on 30-11-1981. Later a revised return was filed disclosing a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... th Rs. 36,600 was explained to belong to the HUF Rajendrakumar for which there was apparently no source of acquisition. One FDR of Rs. 50,000 in the joint name of Rajendrakumar Shivkisan and Shivratan Mulchand purchased on 9-10-1979 was found. One FDR of Rs. 25,000 purchased by Rajendrakumar Shivkisan on 9-6-1983 was found. One FDR of Rs. 10,000 in the name of Ku. Komal daughter of Rajendrakumar was found. After considering the relevant explanation, the ITO was of the opinion that the amounts of Rs. 50,000, Rs. 25,000 and Rs. 10,000 representing the FDRs were the assessee's income from undisclosed sources in the years 1980-81, 1984-85 and 1984-85 (sic) respectively. One Premier Padmini Car purchased from Jaipur on 30-4-1982 was also noticed. It was stated that Prabhatilal had taken Rs. 50,000 from Rajendrakumar and the remaining amount was adjusted by him by gift received at the time of Kanyadan at the time of marriage. The sum of Rs. 50,000 invested in the purchase of the car was treated as this assessee's income from undisclosed sources. The ITO also noticed in detail in the case of Shri Shivkisan that the standard of living of both the assessees was very high. The family owned A ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ving that the assessees were guilty of concealment was upon the revenue. The representative of the assessee has referred some authorities for the proposition that no penalty should be levied in these circumstances. For example, he has quoted CIT v. Prafulla Kumar Mallik [1976] 104 ITR 648 (Ori.). That however, was a case of unexplained cash credit and the transactions related to a very old period. The creditors could not be traced and even from the assessee's petition it could not be spelt that the assessee's own money had been introduced in the name of fictitious creditors. The Tribunal had also held that the Income-tax Officer had made no exercise either of diligence or acumen or had any source of information that the hundi loans were concealed income of the assessee. This case, therefore, does not very much help the assessee. Another case quoted was Badshah Prasad v. CIT [1981] 127 ITR 601 (Pat.). In this case the revised returns were filed by the assessee before any detection by the Department and all the returns were based on the payment certificates issued by the authorities for whom the assessee, a contractor, had executed the contract, so that the revised returns were obvio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the scope of section 271(1)(c) and the order of the Tribunal cancelling the penalty on the ground that the assessee had discovered a mistake in his return and rectified the same before detection, was quashed by their Lordships. Similarly, in Addl. CIT v. Radhey Shyam [1980] 123 ITR 125 (All.), the High Court clearly held that the benefit of a revised return cannot be claimed by an assessee if the original return does not contain the true particulars of his income. Again in Kumar Jagadish Chandra Sinha v. CIT [1982] 137 ITR 722 (Cal.), it was held that the offence of concealment of income was complete when the original voluntary returns were filed and the revised return did not obliterate the offence. 14. Coming to the actual circumstances in CIT v. K. Mahim [1984] 149 ITR 737 (Ker.), the assessee had filed a revised return voluntarily because he knew that the department was carrying on some kind of investigation. It was held that filing of voluntary revised return in these circumstances would not exonerate the assessee from liability to penalty u/s 271(1)(c) of the IT Act. The facts of this case are nearly on all fours with this case. 15. In Loknath Chowdhury v. CIT [1985] 155 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... any facts material to the computation of the total income of any person under this Act, --- (A) such person fails to offer an explanation or offers an explanation which is found by the Income-tax Officer or the Appellate Assistant Commissioner or the Commissioner (Appeals) to be false, or (B) such person offers an explanation which he is not able to substantiate, then, the amount added or disallowed in computing the total income of such person as a result thereof shall, for the purpose of clause (c) of this sub-section, be deemed to represent the income in respect of which particulars have been concealed : Provided that nothing contained in this Explanation shall apply to a case referred to in clause (B) in respect of any amount added or disallowed as a result of the rejection of any explanation offered by such person, if such explanation is bona fide and all the facts relating to the same and material to the computation of his total income have been disclosed by him." Their lordships held that clause (B) of this Explanation was clearly applicable. It needs be pointed out that most of the authorities discussed above related to earlier years when this Explanation was not on ..... X X X X Extracts X X X X X X X X Extracts X X X X
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