B.P.JEEVAN REDDY, J. - (1.) UNDER section 256(2) of the Income-tax Act, 1961, the Tribunal has stated the following two questions for the opinion of this court : "(1) Whether, in law of the Explanation added to section 271(1)(c) of the Income-tax Act, 1961, the Tribunal was justified in holding that the principle of law laid down by the Supreme court in CIT v. Anwar Ali, 1970 76 ITR 696 still hold the field ? (2) Whether, on the facts and in the circumstances of the case, the Tribunal was justified in canceling the penalty of Rs. 75,000 imposed under section 271(1)(c) of the Income-tax Act, 1961 ?"
(2.) SO far as question No. 1 is concerned, we are unable to find any express statement in order of the Tribunal to the effect that, even after the introduction of the Explanation to section 271(1)(c) , the decision of the Supreme Court in the case of Anwar Ali, 1970 76 ITR 696 continues to be good law. It is no doubt true that the Tribunal applied the principle of Anwar Alis case, 1970 76 ITR 696 but from that it does not follow that they have recorded a finding to the effect that Anwar Alis case, 1970 76 ITR 696, continue to hold the field even after the Explanation was added. Anwar Alis case, 1970 76 ITR 696 was rendered with reference to section 28(1)(c) of the Indian Income-tax Act, 1922. This case is binding upon us in so far as it interprets the provisions of section (SC) does not deal with the Explanation to section 271(1)(c) , it cannot be treated as binding law in a case arising under the 1961 Act. So far as the position obtaining by virtue of the said Explanation is concerned, it has been clearly enunciated by the Supreme Court again in CIT v. Mussadial Ram Bharose, 1987 165 ITR 14. The Supreme Court has held that the said Explanation has the effect of shifting the burden of proving absence of fraud or gross or wilful neglect on to the assessee. It has also held that, where a finding is recorded by the Tribunal that the assessee has discharged the said onus, on a consideration of the relevant facts, it becomes a conclusion of fact and no question of law arises therefrom. It is thus clear that, in a case arising under the 1961 Act to which the said Explanation is attracted, it is only the law enunciated in the case of CIT v. Mussadilal Ram Bharose., 1987 165 ITR 14 that applies. The ratio of Anwar Alis case, 1970 76 ITR 696 holds the field even after the introduction of the Explanation, we think it unnecessary to answer question No. 1. So far as question No. 2 is concerned, while it is true that the approach of the Tribunal is coloured by the ratio of Anwar Alis case, 1970 76 ITR 696, we find at the same time that, on a full consideration of relevant facts and circumstances, the Tribunal has recorded a finding that the assessee in this case is not guilty of concealment of his income nor of furnishing inaccurate particulars of his income. In view of this finding which is one of fact and which, in our opinion, is not, in any manner, vitiated by taking into consideration the principles of Anwar Alis case, 1970 76 ITR 696, we answer question No. 2 in the affirmative. i.e., in favour of the assessee and against the Revenue.
(3.) REFERENCE is answered accordingly.;