TMI Blog2003 (1) TMI 244X X X X Extracts X X X X X X X X Extracts X X X X ..... it basis during the year under consideration and the profit of such transactions could not be returned alongwith the book profits due to non-accessability to such transactions. As the statutory period for filing the return is expiring and in order to file the return in time the assessee is filing the return and the same shall be revised at the earliest." The assessee thereafter revised the return on 20th Feb., 1991, in which additional income of Rs. 1,10,000 was declared. The AO while making assessment made another ad hoc addition of Rs. 50,000 apart from the amount surrendered by the assessee. He also initiated penalty proceedings under s. 271(1)(c) of the Act but subsequently dropped the same. 3. The above referred to additional incom ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... me declared voluntarily. 3. I have considered this matter and the plain reading of the Expln. 2 to s. 271(1)(c) would show that the views of the appellant's counsel are correct. The said explanation comes into operation where the source of any receipt, deposit, outgoing or investment in any assessment year is sought to be explained by the assessee to be the amount which was added in computing the income or deducted in computing the loss for any earlier assessment year or years but in respect of which no penalty had been levied. As it is a fact that this amount was neither added to the income or deducted from the loss of the appellant for the earlier assessment year, no penalty under s. 271(1)(c) could be levied. Hence, the penalty levied ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... particulars of which had been concealed or inaccurate particulars of which had been furnished for the first preceding year; and where the amount so added or deducted in the first preceding year is not sufficient to cover the utilised amount, that part of the amount so added or deducted in the year immediately preceding the first preceding year which is sufficient to cover such part of the utilised amount as is not so covered shall be treated to be the income of the assessee, particulars of which had been concealed or inaccurate particulars of which had been furnished for the immediately preceding first preceding year and so on, until the entire utilised amount is covered by the amount so added or deducted in such earlier assessment year." ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... not be levied as it was voluntarily surrendered and this claim of the assessee was accepted. Now, there is nothing in the Explanation to revive a case of levy of penalty after it is dropped on merit. The Explanation which was accepted at the time of dropping of first penalty proceedings was still valid and acceptable. Expln. 2 referred to above had nothing to do with the dropped proceedings. Having dropped the penalty once, there is no machinery in the Explanation to revive the levy. The assessee through out accepted that sum of Rs. 1,10,000 was income earned on certain transaction of business. Whether the said sum was credited or kept outside the books of account was immaterial. The mere fact that it was credited on 26th Feb., 1992, did n ..... X X X X Extracts X X X X X X X X Extracts X X X X
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