9911796707
TMI Blog2012 (6) TMI 181X X X X Extracts X X X X X X X X Extracts X X X X ..... 1,34,696/-. She thereafter revised her return on 28.3.2002 and declared her income to be Rs. 3,84,696/- by adding additional income of Rs. 2,50,000/- which was earlier shown as gift received from Ashok Jain. 3. The assessment order was passed under Section 143(3) of the Act on 28.2.2003 and her taxable income was assessed to be Rs. 6,34,696/- by further including Rs. 2,50,000/- shown to have been received as gift from Smt. Usha Jain and surrendered during assessment proceedings. The appeal of the assessee against the assessment order was dismissed. 4. Simultaneously, penalty proceedings under Section 271(1)(c) of the Act were initiated and a show cause notice was issued on 19.3.2004. The assessee submitted her reply to the show cause noti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... u/s 271(1)(c) by relying on the surrender made by the assessee in the revised return without appreciating that the act of concealment by the assessee was completed while filing the original return by the assessee and the same could not have been corrected by the assessee by filing another return which was not even a revised return within the meaning of provisions of Section 139(5) of the Act. (3) Whether on the facts and in the circumstances of the case, the Hon'ble Tribunal was justified in law in cancelling the aforesaid penalty by improperly appraising the evidence on record and in erroneously coming to the conclusion that the surrender of bogus loan by the assessee was a voluntary act. 7. In substance, the appeal only raises a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d to represent the income in respect of which particulars have been concealed." The aforesaid provision contemplates for levy penalty where the income tax authorities are satisfied that the assessee has concealed particulars of his income or has furnished inaccurate particulars of such income. Therefore, concealment of income and furnishing of inaccurate particulars of income are the two essential ingredients for the imposition of penalty. According to Explanation, where any person fails to offer an explanation or explanation furnished by him is found to be false or where he is unable to substantiate and fails to prove such explanation to be bona fide then, the amount added or disallowed in computing the total income of such person for the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion of Section 271(1)(c) of the Act held that the mere omission from the return of an item of receipt neither amounts to concealment nor to deliberate furnishing of inaccurate particulars of income, unless and until there is some evidence to show or circumstances are found from which it can be gathered that the omission was attributable to an intention or desire on the part of the assessee to hide or conceal the income so as to avoid imposition of tax thereon. In other words, element of mens rea was held to be inherent in concealment/furnishing of inaccurate particulars of income for the purpose of imposing penalty. 11. A similar view has been taken by their Lordships of the Supreme Court in the case of Dilip N. Shroff v. Jt. CIT [2007] 29 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... context of levying penalty under Section 271(1)(c) of the Act concealment or furnishing of inaccurate income signifies a deliberate omission on the part of the assessee and, such deliberate omission either be for the purpose of concealment of income or furnishing of inaccurate particulars. 13. In the light of the above legal position, if we examine the facts of the present case, we find that the assessee-respondent while filing her initial return of income disclosed her income to be Rs. 1,34,696/- in the relevant assessment year and the said return finds mention of receiving gift of Rs. 2,50,000/- from Ashok Jain. In the revised return the said amount of gift was declared as part of her income. Thus, there was no concealment in respect of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the same. 17. In view of above, neither the assessee-respondent failed to furnish any explanation regarding the material facts for computation of her income nor the explanation so furnished by her was false. At least there is no finding to this effect. At the same time, the assessee-respondent having surrendered the above gifts as part of her income just in order to buy peace of mind, may be on realising that she may also be ultimately affected by the racket of gift deeds busted by the department without any such thing being deducted in respect of her return or gifts, cannot be said to have failed to prove or substantiate her explanation regarding the to be bona fides of the two transactions. 18. Accordingly, the assessee is not a person ..... X X X X Extracts X X X X X X X X Extracts X X X X
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