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TMI Blog1980 (7) TMI 42X X X X Extracts X X X X X X X X Extracts X X X X ..... ,464. The impugned order of penalty was passed by the IAC after the disposal of the appeal against the order of assessment by the AAC. Rejecting the explanation offered by the assessee, the IAC held that the ITO examined the accounts thoroughly and could discover the suppression of opening stock and of the purchases made during the year and was able to detect concealment in the real sense. Thus, holding that the assessee had concealed the particulars of his income, for which penalty was leviable under s. 271(1)(c), the IAC imposed a penalty of Rs. 10,000. The assessee came in appeal before the Tribunal against the order of the AAC. The Tribunal confirmed the addition of Rs. 31,464 sustained by the AAC, but it held that the amount represented the assessee's income from the sale of timber and, therefore, it should be charged to tax under the head " Business ", and not under the head " Other sources " as was done by the ITO. In appeal, before the Tribunal against the order of penalty, the assessee merely raised certain legal issues regarding the validity of the penalty order. The assessee argued that the penalty was levied on the basis that the assessee had concealed his income ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the General Clauses Act, 1897, had no application to this case and this case was governed by the amended section 275 of the Income-tax Act, 1961, even though it was the unamended section 275 that was in force at the time of initiation of the penalty proceedings ? 3. Whether the Tribunal was correct in holding that the penalty order in the instant case was not barred by limitation, having been passed within the period of limitation specified in the amended section 275 of the Income-tax Act, 1961, which came into force before the said order was passed ? " Mr. Nirmal Mukherjee, the learned advocate appearing for the assessee makes it clear at the outset that he does not press questions Nos. 2 and 3 before us. In this view of the matter, we feel that we need not answer those two questions. In dealing with question No. 1, it is contended by Mr. Mukherjee that concealment of particulars of income or furnishing of inaccurate particulars of income charged at the initiation of the penalty proceedings upon the finding of the cash introduction in the books of account and considered as assessable under the head " Other sources " and the penalty imposed on that basis completely fell throu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... represented income from business, but not income from undisclosed sources. Here, before us, Mr. Mukherjee on behalf of the assessee reiterates the very same arguments. According to him, the basis for the penalty, proceedings having been altered, the Tribunal was not justified in upholding the order of penalty. In support of his arguments, he refers to the decision of this court in the case of CIT v. Ananda Bazar Patrika P. Ltd. [1979] 116 ITR 416. There, their Lordships, while disposing of the reference, relied on the decisions of several other High Courts to which we will make reference just now. Mr. A. K. Sengupta, appearing on behalf of the revenue, points out that the facts of that case were quite distinct and as such could be distinguished. He also points out that in that case the question which came up for answer before their Lordships was as follows : " Whether the Tribunal was right in holding that the ITO could not initiate or levy penalty in respect of the enhancement made by the AAC?" In that case, again the ITO completed the taxable income as follows: Loss of Rs. 4,951 under the head " Business ", income of Rs. 31,335 under the head " Income from property " and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he assessee had concealed the particulars of his income and had deliberately furnished inaccurate particulars of his income. The ITO was seized of the assessment proceedings and it was not during the assessment proceedings that the sum of Rs. 46,601 was discovered. Next case relates to the decision of the Allahabad High Court in the case of CIT v. Dwarka Prasad Subhash Chandra [1974] 94 ITR 154. The same principle was also enunciated in this very case. Lastly, reference was made to the decision of the Gujarat High Court in the case of CIT v. Lakhdhir Lalji [1972] 85 ITR 77. This case was distinguished from the earlier one. In this case, the IAC proceeded on the footing that the assessee had furnished inaccurate particulars of his income as distinguished from the concealment of the particulars of the income. The notice issued by the ITO on the strength of which the proceedings which ultimately were disposed of by the IAC were commenced, started on the footing that there was concealment of income by suppression of sale of certain bags of garlic. Thus, though the charge was in regard to the concealment of particulars of the income, the ultimate conclusion was based on the footing ..... X X X X Extracts X X X X X X X X Extracts X X X X
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