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TMI Blog2015 (5) TMI 1096X X X X Extracts X X X X X X X X Extracts X X X X ..... considering the same provision, it observed that the assessing officer has to be satisfied that a person has concealed the particulars of his income or furnished inaccurate particulars of such income. Thus the satisfaction of the Assessing Officer about the concealment of particulars of income or furnishing of inaccurate particulars of such income is essential before levying any penalty u/s 271(1)(c). The Assessing Officer as is apparent from the penalty order has not satisfied about the concealment of particulars of income or furnishing of inaccurate particulars of income on the part of the assessee. On this basis itself the penalty deleted. -Decided in favour of assessee X X X X Extracts X X X X X X X X Extracts X X X X ..... r:- Total income as per order u/s 143(3) dt. 31.12.2007 Rs.16,51,640/- Tax on the assessed income Rs.5,26,770/- Less: Tax on the income excluding concealed income (after giving rebate u/s.88) ₹ 1,925/- Tax sought to be evaded Rs.5,24,845/- Therefore, penalty of ₹ 5,24,845/- being 100% of the tax sought to be evaded is imposed u/s. 271(1)(c) of the I.T. Act, 1961" 3. The assessee went in appeal before the ld. CIT(Appeals), who sustained the penalty. 4. We have heard the rival contention of both parties and carefully considered the same along with the order of the authorities below. Section 271 (1)(c) reads as under:- "271 (1) If the Assessing Officer or the Commissioner (Appeals) [or the commissioner] in the course ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s can be initiated on 2 charges i.e. i) concealment of particulars of income and ii) furnishing of inaccurate particulars of income. Both the charges are entirely different. If the proceedings are initiated on charge of concealment, then penalty cannot be levied on the charge of furnishing of inaccurate particulars of income and vice versa. Thus, there must be a clear finding about the charge for which penalty is imposed or initiated. It is incumbent upon the Assessing Officer to state whether penalty was being levied for concealment of income or for furnishing of inaccurate particulars of income. In the absence of such findings, the order would be bad in law. The case of New Sorathia Engineering Co. Ltd., 282 ITR 642, Hon'ble Gujarat High ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is levied S. 271(1) (c) (iii) is expressly clear that the penalty can be levied for concealment of particulars of income or furnishing of inaccurate particulars of income. It is the particulars of income which is the common subject matter of both the charges. The word 'conceal' as per Webster's Dictionary means "to hide, withdraw, or remove from observation; cover or keep from sight; to keep secret; to avoid disclosing or divulging. That means non disclosure of particulars of income. On the other hand, where particulars are disclosed but such disclosure is not correct, true or accurate, it would amount to furnishing of inaccurate particulars of income. For example, in case of businessman, if a particular transaction of sale is not shown in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sessee. Explanation 1 refers to the two situations in which presumption of the concealment of the particulars of income is deemed. It is not applicable where the charge against the assessee is furnishing inaccurate particulars of the income. The first situation is where the assessee in respect of any fact material to the computation of his total income fails to offer an explanation or offers an explanation, which is found by the Assessing Officer or the Commissioner to be false. The second situation is where the assessee in respect of any facts material to the computation of his total income offers an explanation, which, the assessee is not able to substantiate and also fails to prove that such explanation was bona fide one and that all the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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