TMI Blog1980 (4) TMI 91X X X X Extracts X X X X X X X X Extracts X X X X ..... ibunal justified in cancelling the penalty imposed on the assessee for the assessment year 1962-63 ? " The Tribunal has accordingly stated the case for our opinion. It appears that in the course of assessment proceedings for the assessment year 1963-64, the ITO came across certain hundi loans alleged to have been taken by the assessee for the purposes of its business. When the ITO started enquiry into the genuineness of those credits, the assessee surrendered an amount of Rs. 55,000, representing such hundi loans, to be added to its total income for the assessment year 1963-64. That amount was accordingly added to its total income and the assessment for that year was completed. Thereafter, the AAC imposed a penalty of Rs. 30,000 on the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... years. In this process, he added an amount of Rs. 20,000 to the total income of the assessee for the assessment year 1962-63, after reopening the original assessment under the provisions of s. 147. Thereafter, he took fresh proceedings for imposition of penalty under s. 271(1)(c) against the assessee for the year 1962-63, and referred them to the IAC, which resulted in the imposition of the penalty amounting to Rs. 25,031. The assessee again took the matter up in appeal before the Tribunal. The Tribunal opined that as the assessee had surrendered the amount of Rs. 55,000 for being included in the income of the assessee for the year 1963-64, and the department had, after accepting the surrender, taxed that income in that year, there was n ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in reopening the assessments for the earlier years is, therefore, not sustainable. Apart from this if the action of the ITO in reopening the assessment for the year 1962-63, was not correct, it was open to the assessee to have challenged that assessment by way of an appeal. The assessee did not file any such appeal and submitted to the reassessment made for the year 1962-63. In these circumstances, it was not open to the Tribunal in penalty proceedings to say that the reopening of the assessment for the year 1962-63 was not justified. It is not disputed that if the assessment proceedings had been correctly reopened for the year 1962-63, all other conditions requisite for taking proceedings under s. 271(1)(c) are complied with. In this v ..... X X X X Extracts X X X X X X X X Extracts X X X X
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