1975 (9) TMI 35

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..... g the bank manager behind the assessee's back ? (3) Whether the imposition of penalty under section 271(1)(c) of the Act is at all warranted ?" Assessee is a registered firm and carries on business in brooms and jungle products. The year of assessment with which we are concerned is 1962-63. The Income-tax Officer determined the income at Rs. 76,657 which included a sum of Rs. 10,000 said to be credit received by the firm from two persons and an addition of Rs. 41,075 as income from concealed sources. Assessee's appeals for omission of the additions failed before the Appellate Assistant Commissioner. The Appellate Tribunal accepted the assessee's contention in regard to Rs. 10,000 and directed deletion thereof. There is no dispute abou .....

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..... ax Officer rejected the explanation of the assessee and added the amount as income from a concealed source. Consequently, proceedings were taken under section 271(1)(c) of the Act and penalty was also levied. Both the appeals before the Appellate Assistant Commissioner as also the Tribunal failed. Before the Appellate Tribunal while the claim was reduced by deduction of Rs. 10,000 as already indicated, the rest of the addition was sustained and imposition of penalty was not interfered with. The Appellate Tribunal drew adverse inference against the assessee by saying that the evidence placed before it was not well-founded because of the fact that no material question was put by the Income-tax Officer to the bank manager. The assessee came .....

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..... is now for the Appellate Tribunal to decide whether it would examine the bank manager or remit the matter to a subordinate forum for examination of the bank manager in the presence of the assessee. After the assessee is given an opportunity of bringing the evidence of the bank manager on record, determination of the first and the third questions would be possible. It would be difficult at present to express any definite opinion on these questions. We would, accordingly, decline to answer questions 1 and 3 now but make it clear that in case the assessee succeeds in correlating the entry in its account with the debit of the amount in its bank account by its withdrawal, the addition has to go and with it the imposition of penalty must fall, ot .....

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