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TMI Blog2016 (10) TMI 405X X X X Extracts X X X X X X X X Extracts X X X X ..... 71 (1) (c) of the Act, which was confirmed by the Commissioner of Income Tax (Appeals) and the Income Tax Appellate Tribunal. Even otherwise, bonafides pleaded by assessee is a question of fact and that would not give raise to substantial question of law before this Court as the appeal under Section 260-A of the Act can be admitted only if substantial question of law is made out by the appellant. The ground urged before this Court that the appellant/assessee bonafidely did not disclose the income is a question of fact, which cannot be enquired into by this Court in view of our aforesaid discussions. The facts on record did not give rise to any substantial question of law, which is essential to admit the appeal. Hence, we find no ground to interfere with the impugned order passed by the Income Tax Appellate Tribunal. Therefore, the appeal fails. Accordingly, the point is answered in favour of the respondents and against the appellant/assessee. - I.T.T.A.No.134 OF 2016 - - - Dated:- 14-7-2016 - SRI RAMESH RANGANATHAN AND SRI M.SATYANARAYANA MURTHY, JJ. FOR THE PETITIONER : AVINASH DESAI ORDER: (Per Hon ble Sri Justice M.Satyanarayana Murthy) With the consent of both ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e Tax Appellate Tribunal, but no purpose was served as the Income Tax Appellate Tribunal by its order dated 30.10.2015 confirmed the order passed by the Assessing Officer and Commissioner of Income Tax (Appeals). Aggrieved by the order of the Income Tax Appellate Tribunal the present appeal is preferred raising several contentions and one among them is that the Tribunal, Commissioner of Income Tax and Assessing Officer are not clear whether the appellant/assessee is guilty of furnishing of inaccurate particulars or concealment of particulars of income and that the appellant/assessee explained the reason for his failure to furnish the particulars; that he bonafidely believed that those particulars need not be furnished. In the absence of any such finding, the penalty order cannot be sustained, in support of his contentions the appellant/assessee placed reliance on a judgment rendered in Commissioner of Income Tax v. Suresh Chandra Mittal (2003) 11 Supreme Court Cases 729 and prayed to set aside the order passed by the Income Tax Appellate Tribunal. Sri Avinash Desai, learned counsel for the appellant/assessee, would contend that the appellant bonafidely believe tha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... present the income in respect of which particulars have been concealed and to initiate proceedings. Explanation 3 to Section 271 (1) (c) of the Act says that where any person fails, without reasonable cause, to furnish within the period specified in sub-section (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 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. Thus, it is clear from the Section 271 (1) (c) of the Act, failure to furnish income and failed to explain the reasons for the same, amount ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nown to him. Thereby, the question of recording any finding by the Assessing authority that the appellant/assessee bonafidely did not disclose the income from different sources in his return does not arise. Even before the Income Tax Appellate Tribunal, no such contention was raised enabling the Tribunal to record a finding that the appellant/assessee bonafidely did not disclose the income except contending that the confirmation of penalty under Section 271 (1) (c) of the Act is improper and arbitrary. Hence, in the absence of any such plea by the appellant/assessee, the authorities are not supposed to record any finding on that issue. This Court while exercising power under Section 260-A of the Income Tax Act can admit the appeal if there is any substantial question of law. To be substantial , a question of law must be debatable, not previously settled by the law of the land or a binding precedent, and must have a material bearing on the decision of the case, if answered either way, in so far as the rights of the parties before it are concerned. It will depend on the facts and circumstance of each case whether a question of law is a substantial one, the paramount overall co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of in penalty proceedings varies from that in the assessment proceeding, a finding in an assessment proceeding that a particular receipt is income cannot automatically be adopted, though a finding in the assessment proceeding constitute good evidence in the penalty proceeding. In the penalty proceedings, thus, the authorities must consider the matter afresh as the question has to be considered from a different angle. The expression conceal is of great importance. According to Law Lexicon, the word conceal means: to hide or keep secret. The word conceal is con plus clear 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. It signifies a deliberate act of omission on the part of the assessee. Such deliberate act must be either ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... g the said question of fact the presumption created by it has to be applied, which has the effect of shifting the burden of proof. The entire material on record has to be considered keeping in mind the said presumption and a finding be recorded as held in Commissioner of Income Tax v. Jeevan Lal Sah (1994) 205 ITR 244 (SC) The appellant/assessee being the sales tax practitioner, who is conversant to the procedure of filing return under Sales Tax or VAT Act, is supposed to know ill-consequences of filing return of income, concealing the income or furnishing inaccurate particulars in the return and still the appellant/assessee did not disclose the income from different sources. If an ordinary man made such mistake, there is some justification in doing so, but here the appellant/assessee being the Sales Tax practitioner is not supposed to conceal the income of his own to escape from tax liability. Taking into consideration of the profession of the appellant/assessee, it is difficult to accept the contention of the appellant/assessee that he bonafidely failed to disclose the income. Therefore, the contention that there are bonafides on the part of the appellant/assessee in his ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he law laid down in Dilip N.Shroff s case is no more good law in view of the decision in Union of India and others v. Dharamendra Textile Processors and others and Union of India v. Rajasthan Spinning and Weaving Mills (referred supra). The quantum of penalty is prescribed in Clause (iii). Explanation 1, appended to Section 271(1)(c) of the Act, it provides that if that person fails to offer an explanation or the explanation offered by such person is found to be false or the explanation offered by him is not substantiated and he fails to prove that such explanation is bona fide and that all the facts relating to the same and material to the computation of his total income has been disclosed by him, for the purposes of Section 271(1)(c), the amount added or disallowed in computing the total income is deemed to represent the concealed income. The penalty spoken of in Section 271(1)(c) is neither criminal nor quasi-criminal but a civil liability; albeit, a strict liability. Such liability being civil in nature, mens rea is not essential to decide the liability to pay penalty by the assessee in view of the judgment referred supra. Therefore, non-discloure of income, whic ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ther hand in the grounds of appeal, in ground No.8 it is contended that the Tribunal ought to have dropped the penalty proceedings in the similar way as was done for the assessment years between 2003 and 2009 as the facts and circumstances were similar in nature in all the assessment years including 2002-2003. It appears from the ground urged in ground No.8 of grounds of appeal that the assessee concealed the income under bona fide impression for the assessment years between 2003 and 2009 also, but for one reason or other, the authorities accepted the same. It is evident from the grounds of appeal, the appellant/assessee being a tax practitioner, for the obvious reasons known to him, filed returns concealing income from different sources and taking advantage of law, avoiding the liability to pay penalty. In any view of the matter, it is clear from the material on record that the appellant/ assessee failed to disclose the income or concealed the income from different sources, filed the return and the same was accepted. However, during search and seizure operation under Section 132 of the Act conducted at Rajiv Gandhi International Airport, Hyderabad, the appellant/assessee was fo ..... X X X X Extracts X X X X X X X X Extracts X X X X
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