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TMI Blog2013 (2) TMI 709X X X X Extracts X X X X X X X X Extracts X X X X ..... leviable. The learned counsel relied upon the decision in the case of DCIT vs. Satish Gupta; 42 SOT 48 (Ahd), the decision from Hon ble jurisdictional High Court in CIT vs. Shyamlal Soni; 276 ITR 156 (MP), CIT vs. S.V. Electricals; 274 ITR 334 (MP); CIT vs. M. Pachamuthu; 295 ITR 502 (Mad.); Smt. Sarita Arawal vs. ITO; 17 ITJ 193 (Indore), Ashok Kumar Jain (HUF) VS. ACIT; ITA No. 502/Ind/2010, ACIT vs. Malu Electrodes Pvt. Ltd; 14 ITJ 388; CIT vs. Surajbhan; 294 ITR 481 (P H); CIT vs. Guru Ramdas; 254 ITR 362 (P H) and CIT vs. Sureshchand Mittal; 251 ITR 9. On the other hand, the learned Senior DR strongly defended the imposition of penalty by placing reliance upon the decisions in 335 ITR 27 (P H) and 238 ITR 461 (SC) by submitting that the assessee concealed its income which was unearthed pursuant to survey conducted by the department on 8.8.2008 whereas the return was filed on 3.12.2008 much after the survey, therefore, it was pleaded that it is a clear case of concealment, consequently, the penalty was rightly levied. 3. We have considered the rival submissions and perused the material available on record. The facts, in brief, are that the assessee, a limited company, engage ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... assessment years 2005-06, 2006-07, 2007-08 2008- 09 respectively as stated by Shri Vishnu Kumar Borana in his statement given during the course of survey action carried out at the company s premises on 8.8.2008. Here I would further like to state that the confirmation in this regard has already been given by me vide my letter dated 8.8.2008 faxed to you during the course of survey proceedings at the company s premises. I again admit that considering the various discrepancies in the books of accounts of the company the income for each of the aforesaid assessment years i.e. 2005-06, 2006-07, 2007-08 and 2008-09 is required to be computed @ 8% of the gross receipts credited to profit lsos account to buy peace of mind and avoid any further litigation in the mater. I also give an assurance to the department that the returns for each of the assessment years will be filed by the dates stated by Shri Vishnu Kumar Borana in his above referred statement. The returns will be filed in the IT Indore office as the actual activity of the business is carried out from Indore itself and the company is in the process of shifting of its registered office from Pune to Indore. I also give an assura ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... this sub-section be deemed to represent the income in respect of which particulars have been concealed. Explanation 3 : Where any person who has not previously been assessed under this Act, fails, without reasonable cause, to furnish within the period specified in subsection (1) of section 153 a return of his income which he is required to furnish under section 139 in respect of any assessment year commencing on or after the 1st day of April, 1989, and, until the expiry of the period aforesaid, no notice has been issued to him under clause (i) of sub-section (1) of section 142 or section 148 and the Assessing Officer or the Commissioner (Appeals) is satisfied that in respect of such assessment year such person has taxable income, then, such person shall, for the purposes of clause (c) of this sub-section, be deemed to have concealed the particulars of his income in respect of such assessment year, notwithstanding that such person furnishes a return of his income at any time after the expiry of the period aforesaid in pursuance of a notice under section 148. In sub-clause (c) to section 271(1) it has been clearly mentioned that if any person has concealed the particula ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of section 271. When the Income-tax Officer or the Appellate Assistant Commissioner issues to an assessee a notice under section 271, he makes the assessee aware that the provisions thereof are to be used against him. These provisions include the Explanation. By reason of the Explanation, where the total income returned by the assessee is less than 80 per cent of the total income assessed under section 143 or 144 or 147, reduced to the extent therein provided, the assessee is deemed to have concealed the particulars of his income or furnished inaccurate particulars thereof, unless he proves that the failure to return the correct income did not arise from any fraud or neglect on his part. The assessee is, therefore, by virtue of the notice under section 271 put to notice that if he does not prove, in the circumstances stated in the Explanation, that his failure to return his correct income was not due to fraud or neglect, he shall be deemed to have concealed the particulars of his income or furnished inaccurate particulars thereof and, consequently, be liable to the penalty provided by that section. No express invocation of the Explanation to section 271 in the notice under section ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ltimate stage of working out the total income would attract the penalty provision. The words inaccurate particulars would cover falsity in the final figures as also the constituent elements or item. They simply would mean inaccurate in some specific or definite respect whether in the constituent or subordinate items of income or the end result. If the facts of the present appeal are kept in juxtaposition with the penalty provision, it is an admitted position that no return of income was filed by the assessee within the time prescribed u/s 139 of the Act. As per the provisions of section 139(4) of the Act, the assessee was to file its return latest by 31.3.2008. Survey u/s 133A of the Act was carried out at the premises of the assessee on 8.8.2008 and upon detection of various discrepancies in books of accounts, documents, data available on computer, etc. and the statement of the General Manager of the assessee company, admitting such discrepancies, penalty was levied. On the basis of discrepancies, the assessee accepted to pay the tax on the taxable income of ₹ 42,80,007/- and not suo motu. For the year, under consideration, i.e. 2006- 07, gross receipts were to the tune of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 1) 335 ITR 23 (P H) 231 CTR (P H) 100 wherein revised return showing higher income was filed pursuant to notice u/s 148. It was held by the Hon ble High Court that this is not a case where the penalty has been imposed only because the assessee disclosed higher income voluntarily but is a case of concealment where the assessee having found no other way out was forced to surrender undisclosed income. The penalty was held to be leviable for concealment. While coming to this conclusion, the Hon ble High Court considered the following cases :- CCE vs. Adhunik Steels Ltd. (2009) 20 DTR (P H) 228 CIT vs. Beta Nepthol Ltd. (2005) 272 ITR 323 (MP) Kohinoor Impex (P) Ltd. (2004) 270 ITR 381 (Del) CIT vs. Oriental Power Cable Ltd. (2008) 9 DTR (Raj) 309 CIT vs. Rajiv Garg Ors. (2008) 18 DTR (P H) 152 CIT vs. Rajnish Nath Aggarwal (2008) 8 DTR (P H) 253 CIT vs. Shankerlal Nebhumal Uttamchandani (2008) 4 DTR (Guj) 238 CIT vs. Smt. Sudarshan Gupta (2008) 10 DTR (P H) 184 CIT vs. Suraj Bhan 294 ITR 481 (P H) Suresh Chandra Mittal (2001) 251 ITR 9 (SC) Union Electric Corpn. 281 ITR 266 (Guj) Dilip N. Shroff 291 ITR 519 (SC) Harigopal Singh vs. CIT; 258 IT ..... X X X X Extracts X X X X X X X X Extracts X X X X
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