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TMI Blog1981 (11) TMI 35X X X X Extracts X X X X X X X X Extracts X X X X ..... Whether, on the facts and in the circumstances of the case, the Income-tax Appellate Tribunal is right in law in casting the burden of proof of concealment on the Department ? 4. Whether, on the facts and in the circumstances of the case, the Income-tax Appellate Tribunal is right in law in finding that the Department has not proved that the assessee had intentionally concealed income or deliberately furnished inaccurate particulars of income for the assessment year 1961-62, and is not such finding perverse, unreasonable and unsupported by any materials?" The assessee is a firm. It is running a, chitty business. It is also carrying on banking business. The assessee is maintaining regular books of account in respect of the banking business, but not in respect of the chitty business. There is no dispute about the income computed from the banking business. This case concerns the income computed from the chitty business for the assessment year 1961-62 (accounting year being the year ended on December 30, 1960). For the assessment year 1961-62 the assessee filed a return on July 17, 1961, showing the income from the chitty business as Rs. 49,233 out of the total income shown as Rs. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... llate Tribunal, in the course of any proceedings under this Act, is satisfied that any person-... (c) has concealed the particulars of his income or deliberately furnished inaccurate particulars of such income ........." Compare the above provision with the requirement mentioned in s. 271 (1)(c) as obtained prior to April 1, 1964 " If the Income-tax Officer or the Appellate Assistant Commissioner in the course of any proceedings under this Act, is satisfied that any person- . ...... (c) has concealed the particulars of his income or deliberately furnished inaccurate particulars of such income , ......... " We have adverted to the above provisions, which are substantially identical, to point out that so far as the questions raised in this case are concerned, s. 297(2)(g) of the 1961 Act, on which much reliance has been placed on behalf of the Revenue, has no relevance. Under s. 297(2)(g) of the present Act: " any proceeding for the imposition of a penalty in respect of any assessment for the year ending on the 31st day of March, 1962, or any earlier year, which is completed on or after the 1st day of April, 1962, may be initiated and any such penalty may be imposed under t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ngful act is committed. It is this principle that is enshrined in the first part of art. 20(1) of the Constitution as per which no person shall be convicted of any offence except for the violation of a law in force at the time of the commission of the act charged as an offence. Therefore, two questions arise : (i) When did the assessee commit the act charged as an offence ? and (ii) was the commission of the act charged as an offence in violation of a law in force at the time of its commission and, therefore, an offence ? The assessee committed the act charged as an offence when he on July 17, 1961, filed the original return without showing the three items of income which he showed in the revised return. There is no dispute on this point. The law in force then (July 17, 1961) was s. 28(1)(c) of the earlier Act of 1922, since the 1961 Act came into force only on April 1, 1962. Has the assessee violated this provision of law ? The basis for the levy of penalty, as stated in the Tribunal's order, are : " (i) The assessee was collecting more commission than what was shown in the books of account as found from the scrutiny of the original contracts. (ii) All the commission r ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mposed only if there is conscious and deliberate concealment on the part of the assessee ", and " the mere fact that the assessee agreed to the inclusion of cash credits or other amounts in the total income on account of his inability to prove the source or to avoid protracted litigation with the department does not by itself justify the levy of penalty: " (See Kanga and Palkivala's The Law and Practice of Income Tax, 7th Edn., Vol. 1, pp. 1211-12 and the cases relied on there). That this is so is not seriously disputed by the learned counsel for the Revenue. His contention is that in view of s. 297(2)(g) of the 1961 Act, the question of penalty both initiation of the proceeding for the imposition thereof and imposition of such penalty thereupon is to be determined with reference to s. 271(1)(c) of the 1961 Act, as that provision stood on June 24, 1970, when the ITO was satisfied that the assessee has concealed the particulars of his income or furnished inaccurate particulars of such income. As earlier indicated, s. 271(1)(c) of the 1961 Act, was amended by the Finance Act, 1964, with effect from April 1, 1964, as a result of which the word " deliberately " in that clause was omitt ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he earlier Act or, in other words, the ITO's satisfaction should be that the assessee is guilty of one or the other of the defaults mentioned in s. 28(1) of the earlier Act. On being so satisfied the assessee shall be liable to be proceeded against under s. 271 (1) of the present Act and he would be liable to a penalty as provided therein. However, the nature and quantum of penalty are also to be governed by the law in force at the time the wrongful act is done. See the Supreme Court decisions in Tiwari Kanhaiyalal v. CIT [1975] 100 ITR 5 and Brij Mohan v. CIT [1979] 120 ITR 1. In the first case the Supreme Court said (P. 9): " We are inclined to think that the offence, if any, committed by the appellant was under section 52 of the 1922, Act as the allegedly false statements in declarations were made at a time when the said Act was in force. No false statement in any declaration seems to have been made under the 1961 Act to form the basis of a charge against the appellant under section 277 of the Act. The punishment provided in this section is greater than the one engrafted in section 52 of the 1922 Act. To that extent only the appellant would be entitled to press into service the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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