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2014 (12) TMI 1181 - AT - Income TaxPenalty u/s. 271(1)(c) - unaccounted gifts - Held that:- The assessee has claimed to have received gifts. The payments were received through cheques. The Hon’ble Supreme Court in the case of CIT Vs P. Mohanakala [2007 (5) TMI 192 - SUPREME Court ] has held that transfer of monies through banking channels is not sufficient to hold gifts as genuine. It is also an admitted fact that the donors are not at all related to the donees. In all the proceedings, the main plea of the assessee was that the amount was offered as income to avoid litigation and to purchase peace of mind. The assessee had no intention to declare its true income. It is the statutory duty of the assessee to record all its transactions in the books of account, to explain the source of payments made by it and to declare its true income in the return of income filed by it from year to year. The Assessing Officer had recorded a categorical finding that he was satisfied that the assessee had concealed the true particulars of income and was liable for penalty proceedings under section 271 read with section 274 of the Act. There was no illegality in the Department initiating penalty proceedings. - Decided against assessee.
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