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TMI Blog2013 (11) TMI 528X X X X Extracts X X X X X X X X Extracts X X X X ..... y been noticed in this context that proceedings for escapement, viz, under Section 148 of the Act had been initiated against the assessee. Chain of events and concomitant conduct of the assessee is a clear indicator that there was complete absence of good faith and when the the assessee was placed in a very tight and rather vulnerable position, only then additional income had been disclosed. - Tribunal was wrong in cancelling the penalty imposed on the assessee under Section 271(1)(c) of the Income Tax Act, 1961. – Decided in favor of Revenue. - ITR No.272 to 276 of 1995 - - - Dated:- 21-10-2013 - Rajive Bhalla And Dr. Bharat Bhushan Parsoon,JJ. For the Petitioner : Shri Akshay Jindal, Advocate, for the assessee. For the Respondent : Shri Rajesh Sethi, Advocate for the revenue. ORDER Dr. Bharat Bhushan Parsoon , J. By way of this order, we shall decide ITR Nos.272 to 276 of 1995 and CWP No.1856 of 1993. In a consolidated order dated 14.5.1993 passed in ITA Nos.9434 to 9438/Del/90 in respect of assessment years 1982-83 to 1986-87, following question of law had been referred for opinion of this Court by the Income Tax Appellate Tribunal, Delhi Bench-B, New ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... etition (No.1856 of 1993), which, vide order dated 21.3.1994, was directed to be heard along with these references. The writ petition of the assessee is also being taken up for adjudication along with these references. Before proceeding to answer the question of law, it would be appropriate to narrate the facts of the case as also the circumstances in which this question arose before the Tribunal. More facts follow: The assessee firm was being assessed to income tax. Premises of father of the partners of the assessee firm were raided on 16.7.1987 and account books pertaining to transactions for the period ranging from 1978 to 1987 were seized. In September 1987, the assessee approached the Commissioner of Income Tax, Rohtak with a proposal of settlement offering additional income of Rs.29 lacs for the assessment years 1982-83 to 1986-87. However, when the assessee got information that the Department was issuing notices under Section 148 of the Act, the assessee worked overtime and filed revised returns for the year 1982-83 to 1986-87. Notices under Section 148 of the Act, however, was served upon the assessee for all these assessment years. The notices had also been issued fo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... esh particulars of its income but it was only when the assessee was cornered consequent upon search and seizure proceedings and had received disturbing information of initiation of proceedings under Section 148 of the Act being contemplated against it. Thus, by no means, was it a voluntary exercise of furnishing of fresh particulars by way of revised returns for all these years. When there is no explanation offered by the assessee for having furnished inaccurate particulars of its income (in original assessment framed against it) resulting in concealment of income which had escaped assessment, authority cited by the assessee as The Commissioner of Income tax, West Bengal v. Anwar Ali, 1970(2) SCC 185, holding that there should be sufficiency of grounds for rejection of assessee's explanation as false in assessment proceedings, does not come to the rescue of the assessee. At this stage, it is relevant to take note of the findings recorded by Commissioner of Income Tax (Appeals) on facts of the present case, as below:- ... In view of these facts, I am of the view that the appellant disclosed the additional income for these years only when concerned (cornered). Books of account a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... escaped assessment. It has already been noticed in this context that proceedings for escapement, viz, under Section 148 of the Act had been initiated against the assessee. Chain of events and concomitant conduct of the assessee is a clear indicator that there was complete absence of good faith and when the the assessee was placed in a very tight and rather vulnerable position, only then additional income had been disclosed. By him The assessee had rather conducted unfairly. In short, had there been no search and consequent seizure of account books disclosing concealment of huge income, the assessee was sitting pretty since 1982 and had already got finalized its assessments for the year 1982-83 to 1986-87 clearly by furnishing inaccurate particulars and concealing correct and real income. Claim of the assessee that it was an honest move made by it in good faith while extending cooperation to the authorities and that it was rather a case of genuine hardship to the assessee is a farce. When faced with facts, the assessee has not been able to support and sustain this stand; conduct of the assessee rather is entirely the other way round and belies the case of claimed good faith and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... inancial position of the assessee and partners is very sound. The firm and partners have sufficient assets detailed below from which the assessee can easily pay the penalties and such payments would definitely not cause ruination to the assessee's business. xxx xxx xxx xxx It will be seen from the above that the total assets of the firm and partners are Rs.42,96,455/-. Out of this, the value of immovable assets is only Rs.7,62, 250/-. As against this, penalties payable u/s 271(1) are only Rs.7,43,300/-. The firm and partners are severally and jointly responsible for payment of taxes etc. due from the firm. The firm and partners have sufficient funds from the firm. The firm and partners have sufficient funds from which they can pay the penalty demand of Rs.7,43,300/-. The payment of penalties will, thus not spell ruination to the assessee's business and will not cause any genuine hardship to the assessee. Sequelly, the petition of the assessee under Section 273-A(4) of the Act was dismissed. Learned counsel for the assessee seeking support from Jaswant Rai and another v. Central Board of Direct Taxe and Revenue and others, (1998)5 SCC 77, has urged that it is entitled to bene ..... X X X X Extracts X X X X X X X X Extracts X X X X
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