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TMI Blog2005 (9) TMI 240X X X X Extracts X X X X X X X X Extracts X X X X ..... ing the details as per requisition made under section 142(1) fixing the date for hearing on 20-3-2002. The Ld. Authorised Representative of the assessee appeared and filed a written objection challenging the jurisdiction of the Assessing Officer over the assessee and also confirmed that no return for the assessment year 1995-96 was filed. Since the assessment was due to be barred by limitation, the assessment under section 144/147 was completed vide order dated 27-3-2002 on a total income of Rs. 27,67,850 as under:- 1. Income from salary after Rs. 1,78,403 allowing exemption and deductions 2. Income from other sources: (a) Receipt credited in Rs. 25,40,464 bank account treating as royalty income (b) Estimated undisclosed Rs. 18,000 interest income (c) Estimated undisclosed Rs. 15,000 & ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s. 15,000. Besides this, he has directed the Assessing Officer to allow deduction under section 80RR in respect of the sum of Rs. 25,40,464 added by the Assessing Officer as royalty income and accordingly; allowed the assessee's appeal. Being aggrieved, the revenue preferred second appeal before the Tribunal. The Tribunal in ITA No. 1841/K/2002 vide order dated 19-8-2003 upheld the order passed by the Ld. CIT(A) and accordingly dismissed the revenue's appeal. 3. In the penalty proceedings initiated under section 271(1)(c) it was submitted by the assessee that the disallowance of additions made at the time of assessment were struck down in appeal, therefore, there is no question of concealment of income or furnishing inaccurate particulars of his income and, therefore, the penalty proceedings initiated under section 271 (1)(c) be dropped. However, the Assessing Officer did not accept the assessee's explanation and observed that the assessee did not voluntarily file his return of income disclosing the income received from various sources which he was required to do so as per provisions of the Act, therefore, he was of the view that the assessee deliberately concealed the particulars ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... alment on the part of the assessee. He further submits that as per order under section 254 dated 14-10-2003, the total income computed by the Assessing Officer and the income disclosed by the assessee on 26-3-2002 and the total income finally assessed were same, therefore, the Assessing Officer has erred in holding that the assessee has concealed his particulars of income. He further submits that the entire amount of tax is fully covered by the TDS from the salary and advance tax paid by the assessee, therefore, there was no intention on the part of the assessee not to disclose his income. The Ld. Counsel for the assessee while strongly relying on the order of the Tribunal in ITO v. Bombaywala Readymade Stores [2004] 271 ITR (AT) 1 (Ahd.) (TM) submits that since in this case no return was filed, therefore, no penalty under section 271(1)(c) can be levied. The Ld. Counsel for the assessee also submits that in this case no satisfaction was recorded by the Assessing Officer while initiating proceedings under section 271(1)(c), therefore, on this account also the penalty under section 271(1)(c) is not leviable and for this proposition the reliance was placed on the decisions in CIT v. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 1 (Ahd.) (TM), while relying on the decisions in Thoppil Kutti Eroor v. CIT [1958] 34 ITR 850 (Ker.), S. Narayanappa & Bros. v. CIT [1961] 41 ITR 125 (Mys.) and S. Santhosa Nadar v. First Addl. ITO [1962] 46 ITR 411 (Mad.) it has been held by the Hon'ble President ITAT as a Third Member at page 13 as under:- "I have carefully considered the submissions of both the parties. It is clear from the above quoted case law that the matter in issue is not res integra but is covered by three decisions of the High Courts. No decision taking a contrary view was cited on behalf of the revenue. The decisions cited by the Ld. Departmental Representative in the cases of K.P. Reddy v. CIT [1968] 68 ITR 638 (AP); Thakur Veerpal Singh v. CIT [1988] 172 ITR 238 (MP) and CIT v. Dass Jewellers [2002] 258 ITR 668 (Delhi) do not deal with the controversy before me. In all the above cases the assessee submitted a return and did show in return income which was much less than the assessed income and accordingly it was held that the onus was on the assessee to prove that it was not a case of concealment or of deemed concealment. No such situation arises in this case. Likewise omission of word 'deliberate' fr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... stitute a mitigating circumstance and penalty has been rightly levied." 12. In CIT v. Sudharshan Silk & Sarees [2002] 253 ITR 145 (Kar.), relied on by the Ld. Departmental Representative, it has been held by the Hon'ble Karnataka High Court at page 154 as under:- "...Mere filing of a revised return is not enough. The background and the circumstances in which such returns are filed hold the key to the answer whether such returns are bona fide. What the revised returns in the present cases meant was to pre-empt any action on the part of the Department for reopening of the earlier assessments on the basis of seizures and disclosures made in the course of the search proceedings. Our answer to the question referred by the Tribunal is therefore in the negative. The Income-tax Appellate Tribunal was not in our view justified in cancelling the penalty levied upon the petitioners under section 271(1)(c)...." 13. In all the above cases, relied on by the Ld. Departmental Representative, the returns were filed by the assessee. Whereas in the case before us, the assessee did not file any return either under section 139 or under section 148 or in response to notice under section 142(1), there ..... X X X X Extracts X X X X X X X X Extracts X X X X
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