Decided on March 30,1994



S.BANDYOPADHYAY, A.M. : - (1.) ALL these three appeals filed by the assessee relate to levy of penalty under S. 271(1)(c) of the IT Act, 1961 for the three successive years. Hence, for the sake of convenience, these appeals have been consolidated and a common order is being passed.
(2.) The assessee filed its returns of income for the asst. yrs. 1985-86, 1986-87 and 1987-88 showing respective figures of income of Rs. 52,790, Rs. 61,353 and Rs. 66,975 on 20th April, 1988, 20th April, 1988 and 27th April, 1988 respectively. On 18th Nov., 1988 the Department conducted a survey under S. 133A in the premises of the assessee-firm. Thereafter, the assessee filed revised returns showing revised figures of income of Rs. 1,85,834, Rs. 1,24,160 and Rs. 1,88,580 for the three years on 5th Dec., 1988, 5th Dec., 1988 and 28th Dec., 1988 respectively. Assessments were completed exactly on the basis of the figures of income as shown in the revised returns without making any further addition thereto. However, penalty proceedings under S. 271(1)(c) were initiated during the course of the assessments on account of huge differences in the figures of income as per the assessments and as shown in the original returns of income. In the assessment orders passed by him, the Assessing Officer took note of certain cash credits and other expenses which had been claimed as allowable in the original returns but ultimately, surrendered as income in the revised returns, although, however, he did not go to detail out such cash credits or expenses in the penalty orders. Such details had not even been discussed in the respective assessment orders. The Assessing Officer thereafter stated that for the purpose of levy of penalty the basis is the amount of tax sought to be evaded which is required to be worked out on the basis of tax on the returned income and the tax on assessed income. By considering the originally filed returns to contain the figures of returned income only, he calculated the basis and accordingly levied penalties for each of the three years. In the appeals filed before her, the CIT(A) also virtually repeated the points as taken up by the Assessing Officer in the penalty orders and confirmed the levy of penalties inasmuch as the penalties had been imposed at the minimum levels only.
(3.) BEFORE us, both the sides have referred to the various aspects of the case and have also tried to rely on a number of judgments of different Courts and of Tribunal. We will not relate them separately but while coming to our conclusion, we will refer to such arguments of both the sides at the appropriate places.;

Click here to view full judgement.
Copyright © Regent Computronics Pvt.Ltd.