TMI Blog2014 (11) TMI 608X X X X Extracts X X X X X X X X Extracts X X X X ..... order of penalty cannot be sustained and the Tribunal could not have sustained the same - The Tribunal having failed to take into consideration and deal with the decision of the jurisdictional High Court it would constitute an error in law which goes to the very basis of the controversy involved - even on the assumption that the initial onus lies on the asseessee, the assessee sufficiently discharged its burden by placing explanation and evidence from time to time - no inquiry was made in case of lenders - the Tribunal committed an error in imposing penalty u/s 271(1)(c) of the Act – thus, the order of the Tribunal is upheld – Decided in favour of assessee. - TAX APPEAL NO. 216 of 2004 - - - Dated:- 16-10-2014 - MR. KS JHAVERI AND MR. K ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nd the Tribunal vide impugned order upheld the penalty order. Being aggrieved by the said order, the present appeal is filed. 3. Mr. R.K. Patel, learned advocate appearing for the assessee submitted that the Tribunal has seriously erred in interpreting the provisions of section 271(1)(c ) of the Act based on the judgement of Calcutta High Court. He submitted that the Tribunal has not expressed any opinion on the factual aspect of the matter where the penalty proceedings is commenced in the year 1997 when the original promoter Director was not in the management of the Company and penalty proceedings u/s 271(1)(c ) of the Act having direct nexus to the conduct of the concerned assessee, the same cannot be invoked against the appellant comp ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hereunder: 9. The expression the amount of tax sought to be evaded has been defined in the newly introduced Explanation 4 to section 271(1)(c ) for the purpose of section 271(i)(iii) which was introduced w.e.f. 1/4/76 by Taxation Laws (Amendment) Act, 1975. The said expression contemplates that where the amount of income in respect of which particulars have been concealed or inaccurate particulars have been furnished exceeds the total income, the base of quantum would be the tax that would have been chargeable on the income concealed, had such income been the total income. Therefore, after 1-4- 76 the quantum of penalty is linked with the amount of tax sought to be evaded. Therefore, Explanation and applies to cases where ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e present case the subtle difference between the two stages would not matter. It is nobody's case, and it is not possible to contend, that the Tribunal was not bound by a decision of the jurisdictional High Court, especially when its attention was invited to the said decision. Therefore, whether the Tribunal has recorded any finding or not becomes immaterial. In the facts as are available on record it is apparent that the ratio of a decision of this Court in the case of Commissioner of Income-tax Vs. (supra) applies on all fours. 11. In the case of Commissioner of Income-tax Vs. Manu Engineering Works (supra) this is what is laid down by this Court at Page No.310 of the Reports: ..... We find from the order ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tentions raised by the learned counsel on facts and merits of the matter in the fact situation. 14. In the result, the question is answered in the negative i.e. in favour of the assessee and against the revenue. The Tribunal was not right in upholding the penalty under Section 271(1)(c) of the Act, for the reasons stated hereinbefore. 8. Even on the assumption that the initial onus lies on the appellant, the appellant sufficiently discharged its burden by placing explanation and evidence from time to time before the lower authorities. It appears that no inquiry was made in case of lenders. In view of the aforesaid decision, we are of the opinion that the Tribunal committed an error in imposing penalty u/s 271(1)(c ) of the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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