TMI Blog1985 (7) TMI 184X X X X Extracts X X X X X X X X Extracts X X X X ..... of the Act. The assessee in his reply filed on 28th Feb., 1984 pleaded that they engaged part-time accountant who had manipulated the entries. In effect, the assessee pleaded that he was unaware of the concealment. The ITO was of the view that the attempt to shift the responsibility to the Accountant by the assessee is nothing but an afterthought. According to the ITO, the assessee admitted manipulation of entries in the books of account pertaining to the asst. yr. 1979-80. The detailed accounts have been given regarding the suppression of the sales. Therefore, the ITO came to the conclusion that the concealment of income had been proved beyond doubt. Accordingly, he levied a penalty of Rs. 6460 being the minimum penalty. On appeal the AAC ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... reafter, the ITO initiated proceedings under s. 271(1)(c). The assessee-firm replied that the partners of the firm who are not having enough knowledge to write the accounts relied on the accountant who was asked to finalise the accountant that he was a part-time accountant that he took a lot of time to finalise the accounts, that only after completion of the assessment the partners came to know that the accountant wilfully manipulated the entries without their knowledge, that they were not conscious of those mistakes, that they did not intend to conceal the income deliberately, that they had already been penalised by addition of huge amount to the returned income and refusal of registration to the firm and that the had co-operated with the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... atement that they were not aware of the manipulations of accounts and that they came to know only at the stage of assessment proceedings. This was also not done by the ITO. Before the AAC the assessee filed an affidavit form the said accountant who admitted having committed the mistake for the purpose of giving trouble to the partneRs. Under such circumstances, the AAC following the decision of the Madras High Court in the case of Hariram Sait T. P. S. vs. CIT (1954) 25 ITR 231 (Mad) cancelled the penalty levied by the ITO. Further in order to support the contention that the assessee firm is not guilty of fraud and that it did not intend to defraud and that they did not intend to conceal their income or furnished inaccurate particulars ther ..... X X X X Extracts X X X X X X X X Extracts X X X X
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