9911796707
TMI Blog1996 (1) TMI 21X X X X Extracts X X X X X X X X Extracts X X X X ..... n the circumstances of the case and in law the Appellate Tribunal was correct in holding that the provisions of Explanation 1 to section 271(1)(c) do not apply disregarding its earlier finding that the credits have not been satisfactorily explained? 2. Whether, on the facts and in the circumstances of the case, the Appellate Tribunal was justified in law in holding that telescoping of cash credits into the gross profit addition would not lead to the conclusion that there was concealment of income? 3. Whether, on the facts and in the circumstances of the case and in law the Appellate Tribunal was justified in limiting the levy of penalty under section 271(1)(c) with reference only to two cash credits aggregating to Rs. 25,000 when the Tr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dings the Tribunal was not justified in limiting the addition to only two items of Rs. 25,000 each. The short question that arises for consideration is : Whether the order of the Tribunal suffers from any illegality? The present proceedings relate to the assessment year 1976-77. With effect from April 1, 1976, section 271 has been amended and a proviso is added to Explanation 1. It would be apt to read Explanation 1 here which is as follows : "Explanation 1.---Where in respect of any facts material to the computation of the total income of any person under this Act,-- (A) such person fails to offer an explanation or offers an explanation which is found by the Income-tax Officer or the Appellate Assistant Commissioner to be false, or ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to the computation of his total income. It is only when clause (B) is attracted, viz., where a person has offered an explanation and he has not been able to substantiate that explanation that further enquiry into the presence of the requirements of the proviso has to be made. But if in a given case as in this case, the Tribunal expresses the opinion that no finding that the assessee has not been able to substantiate the explanation, can be recorded, the amount added or disallowed cannot be deemed to represent the income in respect of which particulars have been concealed for purposes of clause (c) of section 271 of the Act. In such a situation, there is no need to look to the requirements of the said proviso to the Explanation. In the ins ..... X X X X Extracts X X X X X X X X Extracts X X X X
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