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TMI Blog2012 (4) TMI 338X X X X Extracts X X X X X X X X Extracts X X X X ..... in whose name the credit stood namely Sri Thimme Gowda had pleaded ignorance of are/such credit given to the assessee during the course of assessment proceedings of the said Thimme Gowda, it is because of this, the assessing officer issued notice for reopening the concluded assessment and called upon the assessee to file a fresh return, In response to said notice issued under Section 148 of the Act, the assessee filed a fresh return for the very assessment year, but indicated the cash credit of Rs. 4.50,000/- as income of the assessee in this return. 4. The assessing officer concluded the assessment based on the return filed by the assessee in response to the notice under Section 148 of the Act. The assessing officer while brought to tax the original income as returned by the assessee and the addition in the return filed Dursuant to Section 148 notice and therefore the total taxable income was assessed at Rs. 9.18,340/- against the original income as returned by the assessee viz.. Rs. 4,68,340/- and called upon the assessee to pay the difference in the tax, also directed to issue penalty notice for levying penalty under Section 271 (1)((c) of the Act. 5. The assessee offered his ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... x amount which was sought to be paid. 9. The assessee appealed to the commissioner of income tax [appeals] and met with success, The commissioner was of the view that when the order of assessment is under Section 143(3) read with Section 147 of the Act, not much reason was forthcoming for the issue of notice under Section 148 of the Act; that no details of the nature of credit of Rs. 4,50,000/- has been discussed; that the explanation offered by the assessee was not independently examined; that it was a credit entry in favour of one Thimme Gowda; that the ratio of the decision of the Supreme Court in the case of Sir Shadilal Sugar & General Mills Ltd. v. Commissioner of Income-tax [1987] 168 ITR 705 was attracted and in favour of the assessee and therefore allowed the appeal, set aside the order of penalty. 10. It was now the turn of the revenue to go in appeal before the tribunal. The tribunal held that the revenue which has gathered Information against the assessee that too in the form of sworn statement by said Thimme Gowda, having not given opportunity to the assessee to cross-examine the said person, that was a lacunae in the penalty proceedings and also was of the opinion t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... without being hindered by the monetary limits. submits that the very circular indicates the decision of the Board to the effect that in cases involving substantial questions of law of importance as well as in cases where a question of law mall be recurring from year to year or from assessee to assessee. such appeals can be pursued by the department without being hindered by the monetary limit, beamed senior counsel submits that the present appeal is one such case and the appellant-revenue was conscious of the circular and it is only after it was examined, it was found that the question was one of importance, a decision was taken to pursue the appeal and therefore neither the circular nor the judgment relied upon by the learned counsel for the respondent-assessee can come in the way of the present appeal. 16. This court on being satisfied that the appeal involves one such question admitted the appeal, on 18-7-2007. The circular, assuming it is so, cannot he a hindrance for the appeal having been presented before this court and more so when the appeal is admitted by this court. But even as per the circular, clause-3 does carve out an exception with regard to the embargo placed on t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t a later stage, and which is also found to be not bona tide, is presumed to be a situation of concealment: that in the present ease, the assessee in fact had admitted the concealment of true particulars of income as returned in the original return by filing a return in response to Section 148 Notice and had itself offered the amount of Rs. 4,50,000/- which had earlier been shown as cash credit, as income and therefore all such questions may not be much relevance, particularly as discussed by the appellate commissioner and the tribunal. 20. However, Sri Indrakumar has placed reliance on the decision of the Supreme Court in the case of k. P. Madhusudhanan v. Commissioner of Income-tax [2001] 252 ITR 99 and submits that the Supreme Court had occasion to examine the ratio of its earlier decision in Sir Shadilal Sugar and General Mills Ltd. (supra) and has clearly held that the ratio in SIR Sir Shadilal Sugar and General Mills Ltd. (supra) does not hold the field any more in view of the amendment to explanation-B as under: No express invocation of the Explanation to section 271 in the notice under section 271 is, in our view, necessary before the provisions of the Explanation therein ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... penalty can be levied and submits that it is a fortiori so in a case where a second return is filed in response to notice issued under Section 148 of the Act. However, the observation in the decision to the effect that furnishing of incorrect particulars or concealment in the subsequent return cannot give cause to multiple levy of penalty, but penalty can be only on the original return, as had been filed by the assessee and if it had resulted in some concealment and is what is sought to be highlighted. 23. Sri Indrakumar has also submitted that satisfaction of the assessing officer is clear from the fact that, he has directed initiations of penalty proceedings while passing orders pursuant to the notice under Section 148 of the Act. and submits that this is sufficient awareness on the part of the assessing officer about his satisfaction, as a conscious decision is taken for initiation of penalty proceedings. 24. Sri Ashok A Kulkarni, learned counsel for the respondent-assessee. on the other hand, has raised three contentions. It is firstly contended that the assessment order with reference to which penalty has been levied viz., assessment order passed pursuant to the notice issu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... when the assessee has concealed particulars of his income or is furnishing inaccurate particulars of such income etc. Non-disclosure or concealment may be total, non-disclosure or even while disclosing, a lesser amount being disclosed can constitute furnishing of inaccurate particulars. 28. In the instant case, the assessee had filed a return and had disclosed the income. However, later the assessee did file another return in response to the notice issued under Section 148 of the Act and in this return what had not been shown as income earlier but claimed as a cash credit was offered as income. The assessment was concluded on such premises. 29. Judicial pronouncements indicate that disclosure of income pursuant, to a search conducted at the premises of the assessee or any other place as a sequel to some development and even if no notice had been issued and the assessee had not been called upon to file a proper return, nevertheless, amounts to concealment of income even in a situation where the assessee had filed such a return before receipt of any notice. 30. We can only say that a return filed pursuant to a notice under Section 148 of the Act for reopening of a concluded assess ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... premium can be placed on the conduct of the assesses in a situation where the assessee had not furnished true and correct particulars of income earlier and therefore a situation arose for levy of penalty and also justifies the levy of penalty. 35. In so far as the argument relates to non-recording of satisfaction for levy of penalty by the assessing officer and the decision relied upon by Sri Kulkarni in this regard is concerned. we are of the view that, the assessing officer showing his awareness about the need and necessity to initiate penalty proceedings is sufficient satisfaction as indicated in the order of assessment leading to penalty proceedings. Penalty proceedings are independent proceedings and the order should justify itself and not merely on an earlier satisfaction. Therefore, we opine that the awareness shown by the assessing officer about the need to initiate penalty proceedings is a good enough satisfaction on the part of the assessing officer. 36. In a situation where the assessee admits that a return which had been filed earlier did not disclose a true or full income, which is the case in the present situation, does not warrant proof or burden on the revenue to ..... 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