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TMI Blog1985 (9) TMI 28X X X X Extracts X X X X X X X X Extracts X X X X ..... produced were not genuine and had been written up only to explain away investments made by the assessee of about rupees two lakhs. In the account books, the assessee had shown a cash credit of Rs. 40,000 as withdrawn from the "Tijori", in driblets of Rs. 10,000 each on December 2, 1964, December 22, 1964, February 28, 1965 and October 22, 1966. The Income-tax Officer called upon the assessee to explain the source from which he became possessed of cash to the extent of Rs. 40,000. The assessee replied by letters dated January 5, 1970 and October 22, 1970, and pointed out that the cash came from his savings from business income earned by him since 1946 and that as he was an illiterate person, he had kept this amount in his safe. The Income-ta ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... bunal said thus : "8. The second appeal relates to the levy of penalty by the Inspecting Assistant Commissioner to the extent of Rs. 33,688. The penalty levied is 100 %, i.e., the tax equivalent to the income declared by the assessee. So far as section 271(1)(c) is concerned, there must be proof of concealment of income or the deliberate furnishing of incorrect particulars of income. What the Income-tax Officer and the Appellate Assistant Commissioner did with regard to the addition of Rs. 30,000 is only by way of surmises and conjectures. Even now the assessee contends that he had Rs. 30,000 with him as his savings in the safe box and that he had advanced a loan of Rs. 40,000 to Rajendra Steel Traders. What is added by the Appellate Assi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... any fraud or any gross or wilful neglect on Ns part, be deemed to have concealed the particulars of his income or furnished inaccurate particulars of such income for the purposes of clause (c) of this sub-section." The effect of the Explanation is that where the total income returned by an assessee is less than 80 per cent. of the total income as assessed, such assessee shall be deemed to have concealed the particulars of his income or furnished inaccurate particulars of such income for the purposes of clause (c), unless he proves that the failure to return the correct income did not arise from any fraud or any gross or wilful neglect on his part. Having regard to the Explanation, there is little doubt that the assessee must be deemed ..... X X X X Extracts X X X X X X X X Extracts X X X X
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