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2014 (9) TMI 822 - HC - Income TaxLevy of penalty u/s 271(1)(c) – Gold seized and confiscated by the Central Excise Department owned by the brother of the applicant - Held that:- In a proceeding initiated under that provision are quasi-criminal in nature and the burden to justify the exercise squarely rests upon the revenue – relying upon ANANTHARAM VEERASINGHAIAH & CO. v. C.I.T. [1980 (4) TMI 2 - SUPREME Court] - mere intangible addition to the assessees book profits, cannot by itself, lead to the conclusion that there was any concealment - in case there existed any admission on the part of the applicant that the gold was held by him and, being under an obligation to furnish its value in the income tax returns, he did not do so, the allegation as to the concealment would have become acceptable - Though the impact of the proceedings initiated under the Central Excise Act and the Income Tax Act can constitute the basis to add income, levy of penalty on the allegation of concealment cannot be sustained - The reason is that concealment was not from the authorities of the Income Tax Department - It has already been mentioned that the applicant was not maintaining books of accounts and there was no occasion to disclose or conceal the gold from the point of view of Income Tax – though, the applicant did not have the benefit of having the gold, its value was computed as income, instead of taking the seizure thereof as loss - Once it is treated as loss, non-disclosure thereof cannot be the subject matter of Section 271 (1)(c) of the Act - The provision concerned does not deal with the concealment of losses – thus, the levy of penalty runs contrary to the provisions of the Act – Decided in favour of assessee.
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