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TMI Blog2007 (9) TMI 236X X X X Extracts X X X X X X X X Extracts X X X X ..... I. T. A. No.110 (Allahabad) of 1996 for the assessment year 1989-90. 3. The relief sought in the present appeal is that the order dated May 28, 1999, passed by the Income-tax Appellate Tribunal, Allahabad, in the Wealth-tax Appeal No. 110 of 1996 for the assessment year 1989-90 in the case of WTO v. Smt. Shakuntala Devi Dalmia, be set aside and the impugned order of penalty made against the assessee under section 18(1) (c) imposed by the Wealth-tax Officer's order dated March 23, 1993, be restored. 4. The following two substantial questions of law have been called for in the present case "1. Whether, on the facts and in the circumstances of the case, the Income-tax Appellate Tribunal was correct in law in holding that neither Explanation ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r made a reference to the Valuation Officer under section 16A of the Act for determining the value of this property. The Valuation Officer of the Income-tax Department determined the fair market value of the property at Rs. 37, 14,000. The Assessing Officer adopted the value of this property at Rs. 37,14,000, on the basis of the report of the Valuation Officer, as against the value of Rs. 82,500 declared by the àssessee. The Assessing Officer also initiated penalty proceedings under 18(1)(c) of the Act. 8. After allowing the assessee an opportunity of being heard, the Assessing Officer passed order dated February 28, 1995, under section 18(1)(c) of the Act. For the reasons given in the said order, the Assessing Officer held that Expl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he Act. 10. The Department filed a second appeal to the Income-tax Appellate Tribunal against the order of the Commissioner of income-tax (Appeals). The Appellate Tribunal held that in this case neither Explanation 2 nor Explanation 4 to section 18(1) (c) of the Act could be applied because the explanation offered by the assessee was sufficient to rebut the presumption of concealing the particulars in relation to the value of the property in question or for furnishing inaccurate particulars of the asset. The Income-tax Appellate Tribunal confirmed the order of the Commissioner of Income-tax (Appeals), cancelling the penalty under section 18(1) (c) of the Act, imposed by the Assessing Officer. 11. As stated earlier, it is this order dated ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e is squarely covered under Explanation 4 of section 18(1)(c) of the Wealth-tax Act, which reads as under : "Explanation 4. Where the value of any asset returned by any person is less than seventy per cent. of the value of such asset as determined in an assessment under section 16 or section 17, such person shall be deemed to have furnished inaccurate particulars of such asset within the meaning of clause (c) of this sub-section, unless he proves that the value of the asset as returned by him is the correct value." 17. In reply, learned counsel for the assessee Sri S. D. Singh has argued that in the facts of the present case, the requirement of Explanation 4 to section 18(1)(c) was fully satisfied by the assessee for the reasons that the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... resumption comes into play and then the burden shifts to the assessee to establish that his failure to return the correct income was not on account of any fraud or gross or wilful neglect on his part. If he fails to establish the same, the presumption will become a finding—and it would be open to the authority to levy the penalty. But if the assessee establishes that his failure to return the correct income was not on account of any fraud or any gross or wilful neglect on his part, it is evident, no penalty can be levied." 20. Learned counsel for the assessee also relied on a decision of the Allahabad High Court rendered in the case of Mohd. Farooq v. CIT reported in [2006] 280 ITR 484 in support of his contention that the value of the pro ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... full effect when the conditions precedent therefor are satisfied and not otherwise. The hon'ble apex court has further held that a duty may be enjoined on the assessee to make a correct disclosure of income but if such disclosure is based on the opinion of an expert, who is otherwise also a registered valuer having been appointed in terms of a statutory scheme, merely because } opinion is not accepted or some other expert gives another opinion, the same by itself may not be sufficient for arriving at a conclusion that the assessee has deliberately furnished inaccurate particulars. A mere omission or negligence would not constitute a deliberate act of suppressio veri or suggestio falsi. 22. Having heard learned counsel for the Department as ..... X X X X Extracts X X X X X X X X Extracts X X X X
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