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of <h1>Court Upholds Penalty for Concealed Income: Importance of Initial Return</h1> <h3>Commissioner Of Income-Tax Versus Dr. Sajjan Singh Malik</h3> Commissioner Of Income-Tax Versus Dr. Sajjan Singh Malik - [1989] 178 ITR 643, 84 CTR 180, 47 TAXMANN 264 Issues Involved: The judgment addresses the issue of whether penalty under section 271(1)(c) was exigible for the assessment year 1969-70 due to alleged concealment of income from private practice and interest on fixed deposit receipts by the assessee.Details of the Judgment:*Assessment Years 1965-66 to 1968-69:* The assessee filed voluntary returns without showing income from private practice, but later admitted to private practice during assessment proceedings. The Income-tax Officer added estimated amounts towards private practice for these years.*Assessment Year 1969-70:* The assessee initially did not show income from private practice in the return but later filed a revised return disclosing income from private practice and interest on fixed deposit receipts. Penalty proceedings were initiated, and a penalty was imposed by the Inspecting Assistant Commissioner.*Income-tax Appellate Tribunal's Decision:* The Tribunal cancelled the penalty, stating that the assessee was not guilty of conscious concealment of income.*Legal Precedents and Interpretation:* The court considered legal precedents and noted that the onus is on the Department to prove concealment of income. The court highlighted the assessee's actions, including the delay in disclosing income from private practice despite prior admissions and assessments.*Decision and Rationale:* The court found that the assessee had concealed income from private practice and interest on fixed deposit receipts. It emphasized that the initial return should be considered for assessing the conduct of the assessee. Consequently, the court held that the penalty under section 271(1)(c) was exigible based on the facts and circumstances of the case.*Conclusion:* The court ruled against the assessee, upholding the imposition of the penalty under section 271(1)(c) and awarded costs to the Department.
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