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2013 (2) TMI 473 - HC - Income TaxPenalty for Concealment of Income – Whether Penalty u/s 271(1)(c) should be imposed or not – Search was carried out in the business premises of the assessee – Found that the assessee had invested Rs. 11 lakhs in two properties and this had not been disclosed – Held that:- Assessee had made a statement under sub-section (4) of section 132 of the Act stating that he had acquired the property out of the income which was not disclosed by him. Subsequently, the assessee filed a return of income before the expiry of time specified under section 139 of the Act and he also paid the tax thereon. Moreover, the assessee had not acted in a contumacious manner. In fact, the assessee had made a clean breast of the entire facts and had admitted the purchase of the property from the income which was not disclosed. The non-disclosure of the income was due to the facts that the assessee was an uneducated and illiterate petty contractor who received payments only after deduction of tax at source. It is under these circumstances that the assessee believed bona fide that no further tax was required to be paid. In T. Ashok Pai v. CIT [2007 (5) TMI 199 - SUPREME COURT] the Supreme Court observed that if the explanation given by an assessee is taken to be bonafide, the question of imposition of penalty under section 271(1)(c) of the Act would not arise. Since assessee had complied with the provisions of clause (2) of Explanation 5 to section 271(1)(c) of the Act, no penalty Shall be imposed – Against the revenue.
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