TMI Blog2005 (2) TMI 69X X X X Extracts X X X X X X X X Extracts X X X X ..... section 260A of the Income-tax Act, 1961 (for short, "the Act"), the appellant has prayed for determination of the following question of law: "Whether, on the facts and circumstances of the case, the hon'ble Tribunal was right in law in cancelling the penalty levied under section 271(1)(c) of the Income-tax Act particularly when the assessee had surrendered the amount of cash credit in the revised return of income when it failed to prove the genuineness of the creditors, particularly in view of the judgment of the hon'ble Punjab and Haryana High Court in the case of Mahavir Metal Works v. CIT [1973] 92 ITR 513 wherein it has been held that the filing of revised return is an admission by the assessee that the income was concealed?" For the assessment year 1987-88, the assessee filed a return on August 31, 1987, declaring an income of Rs. 1,60,010. In the course of the assessment proceedings, counsel for the assessee made an offer to surrender a sum of Rs. 2,95,000 by stating that his client wanted to purchase peace subject to the condition that there would be no penalty and prosecution. The Assessing Officer did not accept the surrender made on behalf of the assessee and finalis ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ly in an attempt to hoodwink the Department. In view of this, the Income-tax Officer was fully justified in treating the credits of Rs. 3,45,000 as unexplained. The Income-tax Officer's action to this extent is confirmed subject to direction in para. 6.1 of this order. 6. The 15th ground of appeal is that at any rate and without prejudice to the above grounds of appeal, the Income-tax Officer erred in not working out the peak of the credits. 6.1 As said earlier, the appellant offered to surrender Rs. 2,95,000 on account of peak of the credits during the course of assessment subject to no penalty, prosecution and interest. While the Income-tax Officer rightly did not accept the surrender he also did not give any reason as to why the addition on account of peak could not be made instead of Rs. 3,45,000. The appellant had given the working of the peak in his unsigned offer given on February 21, 1989. The working of the peak has also been given before me in appellate proceedings as under: Statement of peak deposits ----------------------------------------------------------------- Date Particulars Cr. Dr. Balance Cr. ------------------------------ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... independent proceedings than the proceedings of assessment. It is also true that all the confirmations were filed before the Assessing Officer along with the affidavits of the concerned cash creditors. From the records placed here before us, it emerges that all the cash creditors, are duly assessed to income-tax since the assessment year 1987-88. Therefore, the genuineness of the cash creditors is proved. It is also worth mentioning here that this is not a case of capital build up as learned counsel has stated that all the loans have already been repaid to the respective cash creditors through the middleman. Therefore, in view of these facts and circumstances the matter is restored and the Assessing Officer is directed to decide the issue afresh in view of our observations made above. The Assessing Officer is also directed to allow the assessee opportunity to produce the middleman, Shri Naresh Kumar, and other evidence if he wants to file. We order accordingly." In compliance with the direction given by the Tribunal, the Assessing Officer reconsidered the matter and passed order dated May 23, 2001, whereby he again imposed penalty of Rs. 1,38,310 on the assessee. The appeal fil ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... evidence produced by the assessee on the issue of genuineness of cash credits. Learned counsel also tried to justify the imposition of penalty by the Assessing Officer by arguing that the assessee had failed to discharge the burden which lay upon it to prove the creditworthiness of the persons who had given the loans, but we have not felt persuaded to agree with him. Rather, we are convinced that no question of law, much less a substantial question of law, arises for determination in this appeal. In CIT v. Ms. Monica Oswal [2004] 267 ITR 308 (P H), one of us (G.S. Singhvi J.) to whom the matter was referred on account of difference of opinion amongst the members of the Division Bench interpreted section 260A of the Act and after adverting to the relevant statutory provisions and the judgments of the Supreme Court in Panchugopal Barua v. Umesh Chandra Goswami [1997] 4 SCC 713; Ram Prasad Rajak v. Nand Kumar and Bros. [1998] 6 SCC 748; Kondiba Dagadu Kadam v. Savitribai Sopan Gujar [1999] 3 SCC 722; Hari Singh v. Kanhaiya Lal [1999] 7 SCC 288 and Santosh Hazari v. Purushottam Tiwari [2001] 251 ITR 84 (SC), laid down the following propositions: "(a) An appeal under section 260A ..... X X X X Extracts X X X X X X X X Extracts X X X X
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