TMI Blog1979 (12) TMI 96X X X X Extracts X X X X X X X X Extracts X X X X ..... and for the asst. yr. 1966-67 the previous year ended on31st March, 1966. He was originally assessed on23rd May, 1969on a total income of Rs. 9,621 being share income from M/s. Chotey Lal Contractor, Chandausi. Later on the ITO received an information that the assessee had purchased a property atDelhifor a consideration of Rs. 49,000 and this fact was not disclosed at the time of the original proceedings. The ITO, therefore, formed an opinion that income chargeable to tax escaped assessment and with the approval of the CIT, he issued a notice under s. 148. The assessee filed a return on1st May, 1975declaring income at Rs. 9,620. During the course of the re-assessment proceedings it was explained that the property was purchased with the hel ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 12,500 represented the concealed income of the assessee. The ITO, thus imposed a penalty of Rs. 12,500. 4. Aggrieved, the assessee filed an appeal to the AAC but to no purpose. The AAC confirmed the order of the ITO. The AAC noted that the withdrawals of Rs. 40,600 during the period 8th Nov., 1963 to 5th Oct., 1964 included the withdrawals of small amounts like Rs. 202 and Rs. 2,500 on several dates and such small withdrawals could not have been utilised for the investment in property. Before the AAC it was also mentioned that the bigger HUF had a brick kiln business and had also agricultural income from which the money was utilised in the purchase of the property. In the absence of specific evidence, this explanation was also not accepte ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hat penalty under s. 271(1)(c) should be levied even in the re-assessment made under s. 147. He then referred to the Judgments in CIT vs. Manee Ram Sons(4), Banaras Chemical Factory vs. CIT(5) and Durga Dutta Chunni lal vs. CIT(6) and submitted that in view of these judgements penalty had been rightly sustained by the AAC. He, however, conceded that if the original return of income in this case was filed prior to 1st April, 1968 and the levy of the penalty would be governed by the judgment in Brij Mohan vs. CIT(7). 6. I have carefully considered the rival submissions. The original figure of the income returned is not available but on the basis of the income returned at Rs. 9,620 in the return filed on 1st May, 1975, the explanation to s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the view that no penalty is exigible in this case. The ld. Departmental representative had referred to the judgment in CIT vs. Gopal Krishna Singhania(3) for the submission that penalty under s. 271(1)(c) could be levied in proceedings under s. 147 in respect of a default committed during the original proceedings. There is no dispute about this position of law. He had also referred to the Judgments in CIT vs. Manee Ram and Sons(4) andBanarasChemical Factory vs. CIT(5). In CIT vs. Manee Ram and Sons(4), the assessee surrendered a sum of Rs. 50,000 provided no penalty was imposed. The IAC imposed a penalty of Rs. 35,000. In appeal, the Tribunal set aside the penalty which was levied in respect of the penalty which was levied in respect of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e which no doubt was added to the assessee's income but on a suggestion by the ITO. The present cases are distinguishable from the facts of the aforesaid judgment and this judgment also does not help the Revenue in any manner. The judgment in Durga Dutta Chunni Lal vs. CIT(6), is also not applicable to the facts of this case because in that case the controversy was as to on whom the onus lies to prove in terms of the explanation to s. 271(1)(c) and that the correct income did not arise from any fraud or gross or wilful neglect and penalty was held to be exigible because all the purchases had not been accounted for and there were numerous discrepancies in the accounts. Since I am holding that no penalty is exigible in this case, the ratio of ..... X X X X Extracts X X X X X X X X Extracts X X X X
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