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TMI Blog1983 (5) TMI 40X X X X Extracts X X X X X X X X Extracts X X X X ..... nexplained. Here it will be necessary to point out that in the appeals against the assessment order, the unexplained deposits in the name of the assessee and assessee's wife, which were treated as assessee's income from other sources, was reduced from Rs. 35,000 to Rs. 13,000 only after giving effect to the order of the Appellate Tribunal dt. 24th Feb, 1982 and the break up of the amount of Rs. 13,000 which was held as not explained and consequently assessee's income, was as follows: (a) Rs. 8,000 out of the claim of Rs. 12,000 said to be sale proceeds of stocks of cloth business where the sale proceeds to the extent of Rs. 4,000 were accepted and the balance amount of Rs. 8,000 was not accepted. (b) Rs. 5,000 out of the sale proceeds of jewellery belonging to the mother of the assessee's wife said to have been sold in June, 1973 which in the absence of any evidence regarding sale was not accepted and hence the amount of Rs. 5,000 was also treated as unexplained and consequently assessee's income from other sources. In the course of the assessment proceedings, the ITO also initiated action for penalty u/s 271(1)(c). The ITO was not satisfied with the assessee's explanation ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ul neglect on his part failing which the assessee shall be deemed to have concealed the particulars of his income or furnished inaccurate particulars thereof within the meaning of s. 271(1)(C) of the IT Act, 1961, the material gathered in the course of the assessment proceedings was relevant material and it was not incumbent on the revenue authorities for the purpose of imposing penalty u/s 271(1)(c) to bring any further material in addition to what was already gathered in the course of the assessment proceedings and finally that penalty can also be imposed for unexplained deposits or investments which were treated as assessee's income from undisclosed sources. Elaborating on his arguments, Sri Prasad submitted that the total income shown in the return was only Rs. 6,940 while the total income assessed, even after giving various appeal effects including the order of the Appellate Tribunal, was about Rs. 20,000 that is, in other words, the Explanation to s. 271(1)(C) was clearly attracted. He also referred to the additions from unexplained investment which were sustained in appeals even after the order of the Appellate Tribunal to show that the Appellate Tribunal, after considering ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ding to Shri Gulati, no charge of concealment of income or furnishing inaccurate particulars thereof can arise because of the assessee having made a claim in part 3 of the return that the bank deposits amounting to Rs. 49,000 in the name of the wife and Rs. 2,000 in his own name could not be treated as assessee's income and could not be included in the assessee's total income. He referred to two rulings of the Hon'ble High Court of Madras in the case of Addl. CIT vs. Smt. V. Kanakammal (1979) 118 ITR 94 (Mad) and CIT vs. V.R. Chittal Achi (1983) 34 CTR (Mad) 137 : (1983) 140 ITR 698 (Mad) and another ruling of the Hon'ble High Court of Allahabad in the case of Mohd. Ibrahim Azimulla vs. CIT (1980) 19 CTR (All) 328 : (1981) 131 ITR 680 (All) in support of the contention that the assessment of an item as income while making the assessment by itself is not enough to establish that the assessee had concealed that item from the particulars of income or furnished inaccurate particulars thereof, even if the Explanation to s. 271(1)(C) was attracted, the presumption raised thereby was rebuttable and it was open to the Tribunal on consideration of the entirety of material and evidence to co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... een satisfactorily explained as a result of the assessment proceedings, the order of the AAC and the order of the Appellate Tribunal and only Rs. 13,000 remained regarding which even after appeal to the Appellate Tribunal, it was held that the nature and source was not satisfactorily explained. Even here the assessee's claim of sale proceeds of stocks of the cloth business on winding up the business was Rs. 12,000 while the revenue authorities and the Appellate Tribunal accepted only Rs. 4,000 as the sale proceeds and not the balance amount of Rs. 8,000. Even though the addition of Rs. 8,000 on this account may be justified, a difference of opinion is always possible whether the sale proceeds were Rs. 12,000 as claimed by the assessee, or only Rs. 4,000 as was estimated by the revenue authorities and upheld by the Appellate Tribunal. Where a difference of opinion is possible on whether an amount is assessee's income or not, no penalty for concealment of that income or furnishing inaccurate particulars thereof can possibly lie. Even in respect of the balance amount of Rs. 5,000 which was claimed to be the sale proceeds of ornaments belonging to the assessee's mother-in-law, it was i ..... X X X X Extracts X X X X X X X X Extracts X X X X
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