Concealment penalty upheld where undisclosed truck-sale profit was not explained and the statutory presumption applied.

Penalty under section 271(1)(c) was upheld because the assessee failed to disclose income arising from the sale of a truck and gave no credible explanation for the omission. The Explanation to section 271(1)(c) operated against the assessee since the amount was not shown in the return or relevant disclosure column, and no affidavit or supporting evidence was produced to substantiate the claim of illiteracy. On the facts found, the omission was treated as gross negligence, and the finding of fraud was left undisturbed. The question was answered in the affirmative against the assessee.

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Issues: Whether the penalty imposed under section 271(1)(c) of the Income-tax Act, 1961, read with the Explanation thereto, was justified where the assessee omitted to disclose the amount representing profit from sale of a truck and offered no explanation for the omission.

Analysis: The assessee did not disclose the amount in the return or in the relevant column, and no affidavit or other evidence was produced to support the claim that the omission was due to illiteracy. In the absence of pleading and proof explaining the concealment, the Explanation to section 271(1)(c) operated against the assessee. On the facts found, the omission amounted to gross negligence, and the finding of fraud was not disturbed.

Conclusion: The penalty under section 271(1)(c) was rightly upheld and the question was answered in the affirmative, against the assessee.

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