Concealment penalty sustained where false explanation and failure to disclose the true source showed a receipt was income, not a deposit.

Where the assessee described a receipt as a deposit, the income-tax authorities could rely on the surrounding material to treat it as concealed income and sustain penalty for concealment. The finding was supported not only by the assessment record but also by the absence of the depositors' names in the books, the assessee's false and unsatisfactory explanation, failure to produce supporting material within his special knowledge, and the defective state of the accounts. Penalty proceedings under section 28(1)(c) did not require a higher standard of proof than the materials already justified for assessment purposes, and the same material could establish inaccurate particulars or concealment.

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Issues: Whether, on the facts and circumstances of the case, the department discharged its burden of proving that the sum of Rs. 5,000 was income of the assessee for the purpose of penalty under section 28(1)(c) of the Income-tax Act, 1922.

Analysis: The finding of concealment in the penalty proceedings was not founded merely on the assessment order. The authorities considered additional material, including the absence of the depositors' names in the books, the unsatisfactory and false explanation for the cash credits, the assessee's failure to produce supporting material despite the facts being within his special knowledge, and the unsatisfactory state of the accounts. The Court held that penalty proceedings under section 28 are not to be treated as requiring a higher or different standard of proof from that applicable where the materials already justify the assessment finding. If the receipt was truly income but was described as a deposit, the particulars furnished were inaccurate and concealment was established.

Conclusion: The department had sufficient material to sustain the finding that the Rs. 5,000 represented concealed income, and the penalty was rightly imposed.

Ratio Decidendi: Where the materials before the income-tax authorities, including the assessee's false explanation and failure to disclose the true source of a receipt within his special knowledge, justify the finding that a receipt is income and not a genuine deposit, the same materials can support penalty under section 28(1)(c) for concealment or furnishing inaccurate particulars.

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