TMI Blog2014 (11) TMI 510X X X X Extracts X X X X X X X X Extracts X X X X ..... rson is visited with punishment or penalty, the wrongful act on his part must be established - If not a deliberate intention, at least, intention, as such, must be proved to be existing - The intention of this nature may not be equated to the concept of mens rea - At the same time, the minimum contrast with an instance of mere omission, or failure must be made- Otherwise, every inadvertent omission, or a bona fide understanding of a particular provision, which is not accepted by the Income Tax Officer may expose the assessee to penalty - If that time is pursued, Act may turn out to be the one of the collection of penalties than the income tax. Relying upon Mak Data P. Ltd. v. Commissioner of Income Tax [2013 (11) TMI 14 - SUPREME COURT] ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e same was acceded to on 09.11.1995. The Assessing Officer has taken up an exercise under Section 143(2) of the Act, in respect of the same returns. During the course of verification, he doubted the correctness of the two sundry credits, being ₹ 5,67,840/- and 5,60,160/-, said to be from Super Tyre Retreads and Andhra Rubber Factory. The explanation offered by the respondent was not found to be satisfactory by the Assessing Officer. Thereupon, the respondent agreed for treating those two amounts as income. Accordingly, the order of assessment was passed and tax was paid. The Assessing Officer initiated proceedings under Section 271(1)(c) of the Act, proposing to levy penalty, referable to those two amounts. The respondent subm ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nce to the assessees, the Parliament added Section 271 of the Act, providing for levy of penalty, in case an assessee is found to have suppressed, or concealed income, or posted the incorrect facts. Till it was amended in the year 1964, Section 271(1)(c) of the Act, brought only deliberate concealment, or furnishing of inaccurate particulars as the basis for levy of penalty. Through the Finance Act, 1964, the word deliberately was omitted. Such omission, no doubt, has added new dimensions to the provision. All the same, the revenue has to discharge its burden to prove that there was some intention to conceal or furnish inaccurate particulars on the part of the assessee before penalty is levied. In other words, an inadvertent mistake, or a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he part of the respondent is clear from the fact that those two items were carried forward from the previous year and were not new additions at all. The Commissioner has verified the record in detail and found that there did not exist any occasion, or basis for levy of penalty. Same view was expressed by the Tribunal. It is, no doubt, true that the Tribunal made a reference to the judgment of the Supreme Court in Sir Shadilal Sugar and General Mills Ltd. V. Commissioner of Income Tax 168 ITR 705, which, in turn, was rendered with reference to the provisions as they stood, before Section 271(c) of the Act, was amended. It is not as if the Commissioner and Tribunal proceeded on the assumption that there was no deliberate attempt on the par ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssessing or adjudicatory authorities; not absolute. The levy of penalty is not going to leave the matter at that. It would expose the assessee to prosecution also by treating him as an economic offender. An assessee can be made to suffer such far reaching consequences, if only facts of the case support, and it emerges that the assessee had a clear intention to suppress the income. Learned counsel for the appellant placed reliance upon the judgment of the Supreme Court in Mak Data P. Ltd. v. Commissioner of Income Tax 358 ITR 593. Their Lordships held that once an item of income was found to have been concealed, the mere fact that the assessee has voluntarily disclosed it thereafter, does not absolve him from being proceeded under Sectio ..... X X X X Extracts X X X X X X X X Extracts X X X X
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