9911796707
TMI Blog1980 (10) TMI 12X X X X Extracts X X X X X X X X Extracts X X X X ..... adashat Bahi was recovered from the premises of Shri Sunder Lal, one of the partners. This diary was found containing entries of certain sales of ornaments to various parties mentioned therein. The ITO made enquiries from some of the parties mentioned in the note book, who admitted that they had got gold ornaments prepared from the assessee, for which different sums were paid by them. The assessee was furnished with this information and was given an opportunity to explain. The assessee pleaded that the so called note book was in loose sheets which were got stitched by the officer, who conducted the raid and that the said note book only contained " kacha record " of the ornaments taken by the customers on approval. The assessee pleaded that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... assessee's income from undisclosed sources. The total income was thereafter computed at Rs. 74,660. The assessee filed an appeal. The AAC set aside the assessment taking into consideration that the affidavits filed by the assessee of different customers were rejected without examining them, and the treatment of the entire sale as the assessee's income did not appear to be correct. The ITO was, therefore, directed to make fresh assessment according to law. During the course of fresh assessment proceedings, the assessee produced only Banarsi Dass, who supported the assessee. His statement was not accepted by the ITO. Another customer, Girdhari Lal, was not produced. However, his affidavit supporting the case of the assessee was on the re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is penalty was imposed before the order was passed by the AAC in the appeal filed against the order passed by the ITO in pursuance of the remand. Consequently, in view of the relief given in the quantum appeal, the penalty was reduced to Rs. 8,000. The assessee appealed before the Income-tax Appellate Tribunal (Chandigarh Bench) (hereinafter referred to as " the Tribunal ") that the penalty was not exigible. The Tribunal partly allowed the appeal. At the instance of the assessee, the following questions of law have been referred to this court for its opinion : " (1) Whether, on the facts and in the circumstances of the case, the Tribunal was right in law in holding that even though the original assessment order dated March 30, 1972, had ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ish that the assessee was guilty of concealing the, particulars of his income. Merely because the explanation put forth by the assessee has been found to be false, it would not follow that the penalty was exigible. Mr. Awasthy relies on the Explanation to s. 271(1)(c) of the Act. This court in Addl. CIT v. Jiwan Lal Shah [1977] 109 ITR 474, 483, observed as follows: " In the instant case the mere fact that the explanation given by the assessee in respect of the bank deposits was not accepted does not necessarily lead to the conclusion that the said deposits were concealed incomes or that the assessee furnished inaccurate particulars of his income. The nature of penalty proceedings as quasi-criminal has not undergone any change by the addi ..... X X X X Extracts X X X X X X X X Extracts X X X X
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