9911796707
TMI Blog1998 (8) TMI 2X X X X Extracts X X X X X X X X Extracts X X X X ..... his tax liability for the years 1972-73 to 1976-77. In that petition, he stated that in the light of the statement given by his accountant, Abu Backer, in the return of income to be filed by him for the assessment year 1977-78, he would take note of that statement, and that so far as the years 1972-73 to 1976-77 are concerned, the basis for computing his income for those years would be the accretion to his wealth, that wealth being in the form of the nursing home, which had been built during that period. The assessee stated that the accretion to his wealth in the years ended March 31, 1972, to March 31, 1975, was about Rs. 2,92,000 and that the income already assessed for that period was Rs. 1,00,679, the excess being Rs. 1,91,321. He requ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , the assessee, having admitted that income only after search had taken place, and after his accountant had given a statement, which clearly showed that the assessee had been consistently suppressing his income and concealing the same by not truly recording all the receipts. The Commissioner, however, set aside the penalty so imposed. The Tribunal has sustained the order of the Commissioner. Being aggrieved by that order of the Tribunal, the Revenue is now before us seeking answers to the following questions: "1. Whether, on the facts and in the circumstances of the case, the Appellate Tribunal is justified in law in cancelling the penalties levied under section 271(1)(c) of the Income-tax Act for the assessment years 1972-73 to 1975-76? ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... l gathered at the search had not been the basis for the order levying the penalty. The fact that a search had in fact taken place and that statements attributed to the accountant had also been given was never in dispute. The Tribunal held that it was the bargain between the assessee and the Commissioner that if the assessee were to file the revised returns, he would be exonerated from penalty. No such bargain, however, is evident from the record. The Commissioner, even while directing the filing of the returns under section 147(a) of the Income-tax Act, had directed that penalty proceedings be initiated against the assessee. Learned counsel for the Revenue submitted that the view of the Tribunal is wholly erroneous that it has ignored the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... concealment of income by the assessee. The mere filing of the revised returns in these circumstances cannot have the effect of exgenorating the assessee from the liability far penalties, as the revised return was filed only on the basis that he had concealed his income during the earlier years. The fact that there was a search and that his accountant had given a statement were matters of record and were matters which had been admitted by the assessee himself when he gave a petition to the Commissioner. The Tribunal has by an erroneous approach sought to make a virtue out of a vice. The concealment had been admitted. The Tribunal, however, has regarded filing of the revised statement as being unconnected with the admission of concealment i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 1, 1968, and March 31, 1976, the relevant provision governing penalty under section 271(1)(c) was that the amount of penalty was to be equal to the amount of the income concealed, while the law before 1968 and after 1976 was that penalty is to be calculated on the basis of the amount of tax payable on the amount concealed. The assessment years here are 1972-73, 1973-74 and 1974-75. The penalty imposable during these years was to be equal to the amount of the income concealed, and it is that law which is required to be applied in this case. It is unfortunate that the assessee, though served with notice on these tax cases, twelve plus which cases have been pending in this court for almost twelve years, has failed to appear. We have, therefo ..... X X X X Extracts X X X X X X X X Extracts X X X X
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