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TMI Blog1999 (12) TMI 29X X X X Extracts X X X X X X X X Extracts X X X X ..... nity of meeting the Department's case under the said Explanation ? 2. Whether, on the facts and in the circumstances of the case, the Income-tax Appellate Tribunal was justified in upholding the levy of penalty on the ground that the assessee's explanation as to the expenditure on repairs and maintenance claimed by it was not bona fide and that all the facts relating to the same and material to the computation of its income had not been disclosed by it, without appreciation of the material evidence produced by the assessee ?" The assessee is a firm. The assessee filed its return of income for the year 1990-91 on August 27, 1990, declaring a total income of Rs. 48,361. The assessment wa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... bsp; --------- Total 8,00,000 &nbs ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the conclusion that there was concealment of income and upheld the imposition of penalty but directed that the computation of penalty amount be restricted to the disallowance of Rs. 2,75,720 as sustained by the Income-tax Appellate Tribunal in the quantum appeal. So far as the disallowance with regard to the vehicle maintenance expenditure, the Tribunal held that although the disallowance in that regard had been sustained at Rs. 75,000, the said disallowance was mainly on the ground of absence of supporting vouchers/receipts relating to the expenses and, hence, the provisions of section 271(1)(c) could not be said to be applicable to such disallowance. By filing a miscellaneous petition, the assessee tried for amendment of the order of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he show-cause notice issued, it is mentioned as to why the order imposing penalty should not be made under section 271 of the Income-tax Act, 1961. It is not the case of the assessee that any other explanation was applicable or that he was not able to understand the notice. After service of the notice, the reply was filed and prayer was made that the matter may be kept pending till the decision by the Income-tax Appellate Tribunal, which was not accepted. Explanation 1 to section 271(1)(c) contemplates the amount added or disallowance made by a deeming fiction to represent the income in respect of which particulars have been concealed. The Legislature has cast the burden on the assessee. In the appeal preferred before the Commissioner of In ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ged by way of miscellaneous application. The Tribunal should have considered the same. In these circumstances, we feel that the matter requires re-examination by the Tribunal of the material which was already on record before the assessing authority and then to pass the order regarding levy of penalty under section 271(1)(c). Without considering the material, the Tribunal was not justified in upholding the levy of penalty on the ground that the assessee's explanation as to the expenditure on repairs and maintenance claimed by it was not bona fide and that all the facts relating to the same and material to the computation of its income had not been disclosed by it, without appreciation of the material evidence produced by the assessee. ..... X X X X Extracts X X X X X X X X Extracts X X X X
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