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TMI Blog2003 (11) TMI 20X X X X Extracts X X X X X X X X Extracts X X X X ..... d in the circumstances of the case, was the Tribunal right in law and fact in concurring with the finding of the Commissioner of Income-tax (Appeals) that it was due to oversight that the freight receipts lying in the hands of M/s. Nidhish Transport Corporation were omitted to be included in the accounts of the assessee as the income when it filed its return of income and in holding that the Commissioner of Income-tax (Appeals) has rightly deleted the penalty on this count? 5. Whether, on the facts and in the circumstances of the case, was the Tribunal justified in law, and fact in upholding the finding of the Commissioner of Income-tax (Appeals) in cancelling the penalty levied on the assessee for twice accounting lease rent of lorry in favour of Smt. P.V. Sherine and M/s. Mavoor Trade Links?" We consolidate the above questions and reframe them as the following two questions: "1. Whether, in the absence of a reference application filed at the instance of the assessee, the assessee is precluded from raising the contention whether he is entitled to get full exemption under the amnesty scheme? 2. Whether, on the facts and in the circumstances of the case, the Tribunal is justif ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 3,77,780, i.e., the amount disputed in appeal. In respect of other additions, the assessee is not entitled for the benefit of immunity under the Voluntary Disclosure Scheme. Penalty proceedings originally initiated were allowed to continue. The Income-tax Officer after obtaining the assessee's explanation levied penalty of Rs. 21 lakhs under section 271(1)(c) of the Income-tax Act. The assessee took up the matter before the Commissioner of Income-tax (Appeals) and contended that there was no deliberate defiance of law and that all receipts were duly accounted for in the books, but because of voluminous transactions and the absence of qualified staff there were clerical errors and wrong postings in the accounts. Further it was also contended that the additions were made by not accepting the change in the method of accounting and further that as higher income had been offered under the amnesty scheme no penalty was exigible. The Commissioner of Income-tax (Appeals) held that the immunity under the amnesty scheme need not be with reference to the entire income declared thereunder, but could be restricted to a part of the income declared under the scheme. The appellate authority notic ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ing the amounts offered the amount as per two letters as income to be assessed. Counsel submitted an admission or offer of amounts in the assessment or quantum assessment would justify a penalty especially in the light of Explanation 1. Counsel pointed out that in the light of clause (A) of Explanation 1 to section 271(1)(c) where in respect of any facts material to the computation of the total income such person fails to offer an explanation, then, the amount added in computing the total income of such person as a result thereof shall, for the purposes of clause (c) of section 271(1), be deemed to represent the income in respect of which particulars have been concealed. Counsel submitted that in the instant case instead of offering an explanation the assessee offered the amounts as income. Further it is also pointed out that with reference to the amounts subjected to penalty the assessee did not offer any explanation, instead it agreed for the addition. So there was no question of substantiating the same as contemplated under clause (B) of Explanation 1 to which alone the proviso applies. In order to establish his contention counsel placed reliance on the decisions of this court ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... IT v. K.P. Madhusudanan [2000] 246 ITR 218; CIT v. A. Sreenivasa Pai [2000] 242 ITR 29 and CIT v. Kishorekumar Shamji [2000] 244 ITR 702. We are in agreement with counsel appearing for the Revenue that the Commissioner of Income-tax (Appeals) or the Tribunal has not properly understood the scope of the said provision and not addressed the question in the right perspective. On going through the materials placed before us we are in agreement with counsel for the Revenue that the assessee had not offered any explanation with regard to certain additions made. On the contrary the assessee by its letters dated October 3, 1985, and October 18, 1985, had agreed to the inclusion of Rs. 15,88,204, (general freight receipts) and Rs. 7,32,917 receipts from sister concern, Nidhish Transport Corporation. In fact the Commissioner of Income-tax (Appeals) and the Tribunal have taken note of the fact that there was a clear omission of Rs. 15,88,204 out of general freight receipts and a further omission of Rs. 7,32,917 out of receipts from the sister concern, viz., Nidhish Transport Corporation. The Commissioner of Income-tax (Appeals) also took note of the fact that the appellant by its letters date ..... X X X X Extracts X X X X X X X X Extracts X X X X
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