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TMI Blog2016 (9) TMI 297X X X X Extracts X X X X X X X X Extracts X X X X ..... Concededly, there was no concealment of any material particulars in respect of that part of the return. The concealment found was in respect of normal computation. That the normal computation involved certain disallowances at later and higher stages of the proceedings at the first appellate and the ITAT’s proceedings reflect the unfortunate circumstances of the litigating parties. That would not in any manner deviate from the fact as to whether the AO could have assumed, on the basis of the opinion that there was concealment of income which led to revenue loss. If the revenue evasion were to be accepted, a satisfaction which was otherwise warranted at the time when it was recorded because of operation of Section 115JB(1) or other such like ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... th the CIT(A) and the ITAT added back further amounts to the normal income which led to higher tax liability on the part of the assessee. In the meanwhile, the AO had initiated penalty proceedings by issuing Show Cause Notice (SCN) under Section 271(1)(c) of the 1961 Act to which the assessee had replied. The ITAT s adverse orders on the assessment/quantum proceedings were taken note of in the penalty proceedings. The AO thereafter issued SCN on the basis of an earlier satisfaction opinion recorded by him with respect to concealment of income. This led to penalty order. The CIT(A) deleted the penalty order; the revenue claimed to be aggrieved and preferred an appeal to the ITAT, which by the impugned order affirmed the CIT(A) s order. 3. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e returned loss is reduced, penalty would nevertheless be leviable. After considering these decisions, this Court in Nalwa (supra) observed as follows: 22. In the present case, the income computed as per the normal procedure was less than the income determined by legal fiction namely, book profits‟ under Section 115 JB of the Act. On the basis of normal provision, the income was assessed in the negative i.e. at a loss of ₹ 36,95,21,018. On the other hand, assessment under Section 115 JB of the Act resulted in calculation of profits at ₹ 4,01,63,180. 23. In view thereof, in conclusion, the assessment order records as follows:- Assessed at ₹ 4,01,63,180 u/s 115 JB, being higher of two. Interest u/s 234 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... become the basis of assessment as it was higher of the two. Tax is thus paid on the income assessed under Section 115 JB of the Act. Hence, when the computation was made under Section 115 JB of the Act, the aforesaid concealment had no role to play and was totally irrelevant. Therefore, the concealment did not lead to tax evasion at all. 5. Learned counsel for the revenue had sought to distinguish Nalwa (supra) by stating that the ITAT itself had in the present case decided that the SCN could not be said to have been time-barred. This Court is of the opinion that the distinction sought to be made between the reasoning in Nalwa (supra) and the present case is not germane. What is of importance is that at the time when jurisdiction ..... X X X X Extracts X X X X X X X X Extracts X X X X
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