9911796707
TMI Blog1987 (7) TMI 47X X X X Extracts X X X X X X X X Extracts X X X X ..... of penalty in relation to the return submitted for the assessment year 1962-63. The assessee, as an individual, disclosed his sales before the sales tax authorities for the aforesaid assessment year at Rs. 3,59,803, but before the income-tax authorities he declared his sales at Rs. 2,92,970 for the same assessment year. The assessee failed to explain the source for payment of (i) Rs. 30,000 to Shri S. K. Acharya, and (ii) payment for investment of Rs. 16,500 in house property. The assessee's personal expenses were shown less than in accordance with his standard of living. There was no explanation of the source for payment of life insurance premium. The returned income was Rs. 29,297. The Income-tax Officer taking an overall view of the mat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... discrepancy in the sales figures submitted by the assessee. Whereas, before the Commercial Taxes Department, the sales shown were Rs. 3,59,803, before the income-tax authorities the sales disclosed were only Rs. 2,92,979. There was thus an obvious gap of about Rs. 67,000. There was no explanation for this discrepancy. Another matter which the Inspecting Assistant Commissioner took note of was that the assessee had shown lower net profit. The assessee had himself showed earlier net profit at the rate of 15% at the rate of Rs. 16 per ton. The third aspect noted by the Inspecting Assistant Commissioner was that the assessee had paid Rs. 30,000 to one S. K. Acharya. The explanation in regard to this payment was not found satisfactory by the Ins ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e. The Tribunal held that the Revenue had not established by any evidence that the assessee's average sale rate per ton of coal was more than Rs. 10. It could not, therefore, be said that the assessee furnished inaccurate particulars of his income. The Tribunal held that mere estimate of income without any definite basis did not account for any penalty action. Applying the decision of the Supreme Court in CIT v. Anwar Ali [1970] 76 ITR 696, it cancelled the penalty imposed upon the assessee. The Revenue, being aggrieved by the order of the Tribunal, filed an application under section 256(1) of the Act but without any success. An application was then filed under section 256(2) of the Act before this court. This court, after hearing counsel ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uld govern the relevant law applicable for the quantification of the amount of such penalty under section 18 of the Wealth-tax Act, 1957. " The assessment in this case was completed on March 23, 1967. On the same date, penalty proceedings had been initiated. The satisfaction of the Income-tax Officer that there had been concealment of income thus solidified on March 23, 1967. The penalty would, therefore, be levied in terms of the law as applicable on March 23, 1967. The Tribunal was thus in error in cancelling the penalty on the basis of the authority laid down in the case of CIT v. Anwar Ali [1970] 76 ITR 696 (SC). There being obvious discrepancy of more than 20%, the obligation to explain the difference was squarely upon the assessee. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on the record. That being the law laid down by Full Bench of this court, this Bench is bound by it. In the instant case, the asseesee did not produce any material to show that his explanation was correct. There was no explanation worth the name why the assessee showed a figure of sale before the income-tax authority lower than what he had stated before the sales tax authority. There was thus an obvious concealment. Secondly, in regard to assessed income, although it was based on estimate, yet the estimate was based upon the assessee's own percentage of income from the records of the earlier years. If the rate of sale was higher in earlier years, the incometax authority was fully justified in holding that the income could not be lower in a ..... X X X X Extracts X X X X X X X X Extracts X X X X
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