TMI Blog1998 (5) TMI 4X X X X Extracts X X X X X X X X Extracts X X X X ..... RAJENDRA BABU J.-- The appellants before us preferred a writ petition under article 226 of the Constitution of India before the High Court of Delhi (see [1982] 133 ITR 19) seeking for a direction to extend the benefit of waiver of penalty arising under section 271(4A) of the Income-tax Act, 1961 (hereinafter referred to as "the Act"). Pursuant to a scheme, the second appellant, firm, made an application on February 12, 1965, stating that they would place before the Income-tax Officer a true statement of their financial affairs and transactions and they were prepared to file a statement of the affairs as on March 31, 1965. The statement of affairs filed on May 20, 1965, disclosed an income of about Rs. 28,00,000 as the total accretion to it ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 71(4A) stood satisfied. He referred to various items such as hundi loans and the amounts surrendered, accretion to wealth between different dates. However, a communication was sent by the secretary of the Central Board of Direct Taxes on March 28, 1968, refusing to reduce the penalty. Again another letter was sent on April 18, 1969, by the Commissioner pursuant to a letter received by him on April 14, 1969, making a further report on the matter. He set out the various details thereto as to how the matter had been dealt with by the various authorities and the manner in which the appellants would be entitled to the benefit under the provisions referred to earlier. The Central Board of Direct Taxes has to approve any action of the Commissioner ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... osed the same in the statements of returns which had been filed prior to the introduction of the voluntary disclosure scheme and that circumstance would not make any difference so far as levy of penalty is concerned and dismissed the writ petition. Hence, these appeals by special leave. Shri Dipankar P. Gupta, learned senior counsel, submitted that section 271(1) of the Act enables the Assessing Officer to impose penalty in three different sets of circumstances and in the present case, we are concerned with the exercise of power under clause (c) thereof which states that the assessee has concealed the particulars of his income or furnished inaccurate particulars of such income. The provisions of section 271(4A) enable the Commissioner in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that such a power could be exercised only by the Commissioner and not by the Tribunal and the order made by the Commissioner thereto being final, they could not examine the said contention. A contention was raised before the Tribunal as to whether a penalty as provided under section 271(1)(c) of the Act was attracted at all or not on the basis that in the circumstances of the case there was no deliberate concealment of income or furnishing of any inaccurate particulars of its income and, therefore, the Department had not discharged its burden. The Tribunal proceeded to hold that the Inspecting Assistant Commissioner had based his findings of concealment on the sole consideration that the assessee had itself returned and assessed the higher ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... -operative attitude the assessee expected to be let off lightly in regard to the penalty proceedings and also in regard to payment of tax. The voluntary nature of the declaration was all the more sincere and was beyond doubt since the statement of affairs sent by the assessee with its letter dated May 20, 1965, represented really the income earned by the assessee during the aforesaid period. It was also noticed by the Tribunal that there was a confession made by the assessee voluntarily and earnestly that it had not returned the full income earned by it in those years and had come forward with a disclosure of its escaped income. The disclosure might not have revealed the full extent of the assessee's concealment as the assessee was also dis ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r to the detection of the same and such disclosure could be made even otherwise than in the course of a return by submitting a petition to the Commissioner. In the present case, we have already noticed that the assessee had made the disclosure prior to the coming into force of the voluntary disclosure scheme and long before the Department could initiate any action in respect of the concealed income. The levy of penalty under section 271(1)(c) by itself will not be a circumstance to take him out of the purview of section 271(4A) of the Act. However, learned counsel for the Department submitted that in the present case the records disclose that the concealed income had not been disclosed voluntarily or in good faith prior to the initiation ..... X X X X Extracts X X X X X X X X Extracts X X X X
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