Penalty under section 271(1)(c) falls where no concealment or inaccurate particulars are found on the facts.

Penalty under section 271(1)(c) was unsustainable because the Tribunal, on appreciation of the material, found as a matter of fact that the assessee had neither concealed income nor furnished inaccurate particulars. That factual finding justified cancellation of the penalty, and interference was not warranted where no concealment or inaccuracy was established. The reference was answered against the Revenue and the deletion of penalty was sustained.

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Issues: Whether the assessee had concealed income or furnished inaccurate particulars so as to justify penalty under section 271(1)(c) of the Income-tax Act, 1961, and whether the Tribunal was justified in cancelling the penalties imposed.

Analysis: The Tribunal had, on a detailed appreciation of the material, recorded a finding of fact that the assessee had neither concealed income nor furnished inaccurate particulars of income. The reference arose from penalty proceedings initiated in reassessment proceedings and the questions referred turned on the correctness of that factual finding and the consequent cancellation of penalty.

Conclusion: The finding of no concealment and no furnishing of inaccurate particulars was upheld, and the cancellation of penalty was held to be legally justified.

Final Conclusion: The questions referred were answered against the Revenue and in favour of the assessee, with the penalty deletion sustained.

Ratio Decidendi: Where the Tribunal records a finding of fact that there was neither concealment of income nor furnishing of inaccurate particulars, interference with the deletion of penalty under section 271(1)(c) is not warranted.

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