Survey disclosure alone cannot sustain penalty without evidence of concealment or inaccurate particulars.

Penalty under section 271(1)(c) could not be sustained merely because the assessee made a survey disclosure of additional income. The Revenue had not produced corroborative material to show concealment, inflated expenditure heads, or furnishing of inaccurate particulars, and the assessment record contained no independent evidence supporting the charge. The note also reiterates that quantum proceedings and penalty proceedings are distinct, so a disclosure during survey does not by itself justify penalty where supporting evidence is absent. On this reasoning, the penalty was held unsustainable and deleted in favour of the assessee.

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Issues: Whether penalty under section 271(1)(c) of the Income-tax Act, 1961 was sustainable on the basis of a survey disclosure of additional income, in the absence of corroborative evidence of concealment or furnishing of inaccurate particulars.

Analysis: The assessee had disclosed additional income during survey proceedings, but the Revenue did not bring any material to substantiate the allegation that the relevant expenditure heads were inflated or that income had been concealed. The assessment record did not refer to any independent evidence supporting the penalty charge. It was also noted that quantum proceedings and penalty proceedings are distinct, and that a disclosure during survey, by itself, does not automatically justify penalty where corroboration is lacking.

Conclusion: The penalty was not sustainable and was deleted in favour of the assessee.

Ratio Decidendi: Penalty under section 271(1)(c) cannot be sustained merely on the basis of a survey disclosure unless the Revenue establishes concealment or inaccurate particulars with supporting evidence.

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