9911796707
TMI Blog1981 (6) TMI 99X X X X Extracts X X X X X X X X Extracts X X X X ..... esenting loan, which has been added back as the income of the assessee and Rs. 6,000 by way of additional interest income from pawn boring business. The ITO issued penalty notice under s. 274 read with s. 271 for concealment of income. On appeal the AAC has sustained the addition of Rs. 6,000 but in respect of the cash credit of Rs. 11,000 in the name of Sri Balarama Naicker he has given set of Rs. 6,000 and sustained only the balance of Rs. 5,000. On further appeal the Tribunal, after going into the merits of the case deleted the addition of Rs. 6,000 sustained by the AAC in respect of the interest income and after due consideration of the extent of agricultural income and the size of the family o therefore the creditor, held that it was h ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ate authorities that the creditor would not have lent the amount of Rs. 11,000 to the assessee could not lead to the inference that the credit actually represented concealed income. Further he argued that the levy of penalty is against the spirit of the judgment of the Supreme Court in the case of CIT vs. Khoday Easwar sa & Sons, reeported in (1972) 83 ITR 369 (SC). Further he urged that the penalty levied is quite unjustified and it should be cancelled. The ld. Deptl. Rep. On the other hand strongly supported the orders of the authorities and vehemently argued that to the extent of the addition of Rs. 5,000 sustained by the Tribunal, the ITO is entitled to treat it as income of the assessee. Therefore, he urged that he penalty levied by th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . There is no material on record to establish that the assessee has concealed the particulars of his income or furnished inaccurate particulars of such income. Therefore, notwithstanding the fact that an addition of Rs. 5,000 has been sustained by the Tribunal in the quantum appeal, the penalty imposed cannot be sustained in the absence of any material on record to hold that it constituted the income of the assessee for the year under consideration. There is also nothing on record to show that the assessee acted delierbately in defiance of law or was guilty of conduct contumacious or dishonest or acted in conscious disregard of his obligation. In view of these reasons the impugned penalty is cancelled. 7. In the result the appeal is allowe ..... X X X X Extracts X X X X X X X X Extracts X X X X
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