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TMI Blog2012 (4) TMI 352X X X X Extracts X X X X X X X X Extracts X X X X ..... the findings of the ld. CIT(A) and restore the matter to his file with the directions to readjudicate the levy of penalty - against assessee. - IT APPEAL NO. 4120 (DELHI) OF 2010 - - - Dated:- 20-1-2012 - U.B.S. BEDI, A.N. PAHUJA, JJ. Bhagyadhar Beura for the Appellant. Ms. Y.S. Kakkar for the Respondent. ORDER A.N. Pahuja, Accountant Member - This appeal filed on 06.09.2010 by the Revenue against an order dated 08-06-2010 of the ld. CIT (Appeals)-X, New Delhi for the Assessment Year 2005-06, raises the following grounds:- 1. "On the facts and circumstances of the case and in law, the order of the CIT(A) is wrong, perverse, illegal and against the provisions of law which is liable to be set aside. 2. On the facts and circumstances of the case and in law the learned CIT(A) has erred in deleting the penalty imposed u/s 271(1)(c) by the Assessing Officer without appreciating the facts of the case that the assessee has not discharged its onus of proving that there was no intention of concealment on its part and the mistake was bonafide . 3. The appellant craves leave to add, alter or amend any ground of appeal raised above at the time hearing." 2. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ceedings u/s 271(1)(c) of the Act for furnishing inaccurate particulars of income. 2.2 The assessee did not prefer any appeal against the aforesaid disallowances. Subsequently, in response to a show cause notice before levy of penalty, the assessee submitted that it did not file any inaccurate particulars of income and, therefore, penalty proceedings may be dropped. The assessee also relied upon some judicial pronouncements, which have not been mentioned in the penalty order. In any case, the AO did not accept the explanation of the assessee and imposed a penalty of Rs. 6,50,254/- @ 100% of the tax sought to be evaded on the aforesaid income, invoking explanation (1) to section 271(1)(c) of the Act on the ground that after the insertion of explanation 1 to Section 271(1)(c) of the Act, the onus was on the assessee to show that there was no intention of concealment and not on the Revenue and in the instant case, the assessee did not discharge the said onus in terms of the said explanation. Inter alia, the AO relied upon decision in CIT v. Gurbachan Lal [2001] 250 ITR 157/116 Taxman 138 (Delhi). 3. On appeal, the learned CIT(A) cancelled the penalty in the following ter ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n making the disallowances, but it is seen that there was no concealment on the part of the appellant. Therefore, it is held that the Assessing Officer was not justified in imposing penalty u/s 271(1)(c) of the Act on this account. Hence, the same is deleted." 4. The Revenue is now in appeal before us against the aforesaid findings of learned CIT(A). The ld. DR while carrying us through the findings of the ld. CIT(A) in the impugned order contended that the decisions relied upon by ld. CIT(A) in the case of New Amar Goods Carrier [I.T. Appeal nos. 50 51/D/1992] for the AYs. 1988-89 and 1989-90 and in Chetak Carriers in I.T.A. no. 2934/D/96 for the AY 1991-92 were not relevant. Since the learned CIT(A) did not analyze the facts of these cases nor considered explanation appended below Section 37(1) of the Act introduced by Finance Act, 1998 w.e.f. 01.04.1962, the ld. DR vehemently argued that there was no difference of opinion, the assessee having not filed any appeal against the findings of the AO in the assessment order. While relying upon decisions in the case of CIT v. A.J. Shetty Co. (P.) Ltd., [2002] 255 ITR 180/122 Taxman 389 (Kar.); CIT v. ECS Ltd. [2011], ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n, the word "conceal" means: "to hide or keep secret. The word 'conceal' is con+celare which implies to hide. It means to hide or withdraw from observation; to cover or keep from sight; to prevent the discovery of ; to withhold knowledge of. The offence of concealment is, thus, a direct attempt to hide an item of income or a portion thereof from the knowledge of the income-tax authorities." In Webster's Dictionary, "inaccurate" has been defined as : "not accurate, not exact or correct; not according to truth; erroneous ; as an inaccurate statement, copy or transcript." 5.1 The penalty u/s 271(1)(c) of the Act is leviable if the AO is satisfied in the course of any proceedings under this Act that any person has concealed the particulars of his income or furnished inaccurate particulars of such income. It is well settled that assessment proceedings and penalty proceedings are separate and distinct and as held by Hon'ble Supreme Court in the case of Anantharm Veerasinghaiah Co. v. CIT [1980] 123 ITR 457; the finding in the assessment proceedings cannot be regarded as conclusive for the purposes of the penalty proceedings. It is, therefore, necessary to reappreciate and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... c. 271(1)(c) of the Act. The decision of the ld. CIT(A) merely proceeds on the basis of view taken by the ITAT in the case of sister concerns of the assessee. A finding of fact recorded in some other case cannot be relied on as a precedent for the purpose of recording a finding in the instant case, as concluded by the Hon'ble Karnataka High Court in A.J. Shetty Co. (P) Ltd. ( supra ), relied upon by the ld. DR. In that case, the assessee claimed two items of expenditure, namely, (1) and expenditure incurred towards helping the excise authorities in conducting raids on illegal manufacturers of liquor and an expenditure incurred towards payment/donation to informants providing information regarding illicit brewing of liquor and also to charitable organizations. The Tribunal, in appeal allowed and directed deduction of an amount of 50 per cent. in respect of the raid expenses and 75 per cent., an expense towards donation/awards paid by the assessee to informants. The Tribunal held this to be an item of expenditure allowable under section 37(1) of the Act. On appeal, Hon'ble High Court reversed the order of the ITAT on the ground that the Income-tax Appellate Tribunal had not recor ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the onus either by direct evidence or circumstantial evidence, or both. 5.3 In Sethi Industries Corporation ( supra ), levy of penalty was upheld since the explanation offered by the assessee was not found to be bonafide , the assessee having claimed loss once in AY 1998-99 again in AY 1999-2000. In N.S. Ichoponani ( supra ) the Tribunal held that since the addition was a result of disallowance, the assessee could not be held to have concealed the particulars of income. However, on appeal, Hon'ble High Court found that the Tribunal had not indicated any material in support of its finding. On the other hand, the finding recorded by the AO was that this was a fit case for levy of penalty and penalty at 100 per cent. of the tax sought to be evaded. This observation had not been dealt with by the Tribunal. Accordingly, the matter was remanded to the Tribunal for a fresh decision in accordance with law. 5.4 In Kanchenjunga Advertising (P.) Ltd. ( supra ); it was held that where a claim is ex facie bogus, and explanation is not bona fide , the assessee makes himself liable to the penalty, the assessee having not made full disclosure in the return of income by giving ..... X X X X Extracts X X X X X X X X Extracts X X X X
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