TMI Blog2003 (3) TMI 59X X X X Extracts X X X X X X X X Extracts X X X X ..... on against the assessee and in favour of the Revenue. - answered against the assessee and in favour of the Revenue. - - - - - Dated:- 21-3-2003 - Judge(s) : K. S. RADHAKRISHNAN., K. PADMANABHAN NAIR. JUDGMENT The judgment of the court was delivered by K.S. RADHAKRISHNAN J.- Income-tax References Nos. 160 of 1999 and 161 of 1999 arise out of I.T.A. Nos. 879 and 880/Coch of 1991 on the file of the Income-tax Appellate Tribunal, Cochin Bench. The assessment years concerned are 1979-80 and 1980-81. The following questions of law arise for consideration: "1. Whether the Tribunal was right in law in sustaining the penalty levied under section 271(1)(c) of the Income-tax Act? 2. Whether the Tribunal was right in law in holding that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... h 5, 1985. Thereafter, the assessee made a disclosure under section 273A with regard to a sum of Rs. 40,000 as unexplained investment in two vans. Later, the assessee filed another return on May 21, 1985, offering an additional amount of Rs. 19,337 as income on account of investment in an immovable property. In that return the total income computed was at Rs. 58,618 including the sum of Rs. 40,000 offered under section 273A and the sum of Rs. 19,337 as investment in the immovable property. The Assessing Officer issued notice under section 147(a) to reopen the assessment with the approval of the Commissioner of Income-tax. Reassessment was completed on an income of Rs. 1,64,910 which included Rs. 55,000 added as income from other sources. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ee took up the matter in appeal before the Tribunal and contended that the Commissioner (Appeals) was not justified in upholding the penalty. The Tribunal upheld the penalty, but made an observation that the assessee could seek other remedy by way of reduction or waiver before the Commissioner. The assessee is aggrieved by those orders and hence these revisions. Counsel appearing for the applicant, Sri C. Kochunni Nair, laid considerable stress on the proviso to Explanation 1 to section 271(1)(c) and contended that the question referred should be considered under the said provisions especially since the Income-tax Officer had declined to give relief under section 273A. According to counsel, the assessee is saved by the proviso to the Expl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... articulars" have not been defined either in the section or elsewhere in the Act. The scope of this provision came up for consideration before a Bench of this court in CIT v. Kishorekumar Shamji [2000] 244 ITR 702. The Bench held the proviso to Explanation 1 is concerned only with cases coming under clause (B) of the Explanation, where the assessee offered an explanation which he was not able to substantiate. The explanation of the assessee for the purpose of avoidance of penalty must be an acceptable explanation; it should not be a fantastic or fanciful one. As indicated above, consequence follows as a matter of law. The burden is on the assessee. If he fails to discharge that burden, the presumption that he had concealed the income or furn ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ourt held that on the contrary, in such cases also the assessee is required to discharge the burden placed by the Explanation appended to section 271(1)(c). In case an explanation is offered, the Assessing Officer is to examine it and find out whether the assessee has been able to establish that there was no concealment. We may examine the facts in this case in the light of the abovementioned legal principles. In the instant case, for the assessment year 1979-80, the assessee filed the return of income originally on October 5, 1979, showing a loss of Rs. 8,510. The assessment was completed under section 143(1)(a) accepting the loss as shown by the assessee. The assessment was later reopened under section 147(a) and in the proceedings date ..... X X X X Extracts X X X X X X X X Extracts X X X X
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