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TMI Blog2007 (7) TMI 35X X X X Extracts X X X X X X X X Extracts X X X X ..... stantial questions of law formulated for entertainment of the appeal are as follows: 1. Whether on the facts and circumstances of the case, the Tribunal was right in holding that no penalty under Section 271(1)(c) is impermissible as nothing was concealed from the department, when the assessee had filed revised returns admitting an additional income of Rs.22,65,900/- only after the survey under Section 133A of the I.T. Act 1961? 2. Whether on the facts and circumstances of the case liability to penalty can be avoided by filing a revised return after concealment was detected by the assessing officer by a survey u/s 133A of the Income Tax Act 1961 ? 2. The statement of facts as culled out from the grounds of appeal is as follows: ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... was held that mere addition of income by disallowing expenses would not be regarded as concealment of income and therefore levy of penalty under Section 271(1)(c) was not justified in such cases, has confirmed the order of the Commissioner of Income Tax Appeals. The correctness of the said order is now put in issue before this Court. 4. Learned counsel appearing for the Revenue submitted that but for the survey the assessee would not have filed revised return and further the admission of additional income in the revised return consequent to survey is an acceptance by the assessee and that the addition would amount to concealment. Section 271(1)(c) speaks about not only concealment but also incorrect particulars. The present case if ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... titute a deliberate act of suppressio veri or suggestio falsi. 7. The Apex Court further observed that the explanation appended to Section 271(1)(c) is an exception to the general rule. It raises a legal fiction by reason whereof the burden of proof shifts from the Department to the assessee. Legal fiction, however, as is well known, must be given full effect the conditions precedent thereof are satisfied and not otherwise. 8. The object of an Explanation to a statutory provision is (a) to explain the meaning and intendment of the Act itself (b ) where there is any obscurity or vagueness in the main enactment, to clarify the same so as to make it consistent with the dominant object which it seems to subserve; (c) to provide add ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... same and material to the income were not disclosed by him. Thus apart from his explanation being not bona fide, it should have been found as a fact that he has not disclosed all the facts which were material to the computation of his income. 10. So far as the present case is concerned the assessing authority has given reasons for imposition of penalty as follows: "As the expenses claimed are not supported by proper vouchers the assessee offered for assessment Rs.22,65,900/- in the course of survey operation. This is clear indication that the assessee had claimed expenditure to the tune of Rs.22,65,900/- though no proper vouchers existed for the same. Since the expenditure incurred is not supported by proper vouchers, the assesse ..... X X X X Extracts X X X X X X X X Extracts X X X X
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