Penalty for concealment remains available where unexplained accretion to wealth is not satisfactorily sourced.

Penalty under section 28(1)(c) of the Indian Income-tax Act, 1922 applies where concealment of income or deliberate furnishing of inaccurate particulars is established. In cases of unexplained accretion to wealth, the assessee must explain the source because the acquisition and its source are peculiarly within the assessee's knowledge. An estimated or ad hoc allocation of the accretion across assessment years does not, by itself, defeat concealment or make the penalty provision inapplicable. The analysis states that the earlier finding linking the accretions to the relevant years remained operative, and penalty could not be disturbed without a clear finding that there was no concealment for each year.

---

---

Issues: Whether the penalty provision under section 28(1)(c) of the Indian Income-tax Act, 1922 was inapplicable on the facts and circumstances of the case for the assessment years 1950-51 to 1953-54.

Analysis: Penalty under section 28(1)(c) is attracted only where concealment of income or deliberate furnishing of inaccurate particulars is established. Where unexplained accretion to wealth is found, the assessee must explain the source, because the acquisition and its source are peculiarly within the assessee's knowledge. The mere fact that the reassessment involved an estimated or ad hoc allocation of accretion among years does not, by itself, negatve concealment or render the penalty provision inapplicable. The earlier finding that the accretions were referable to the relevant assessment years remained operative, and the Tribunal could not set aside the penalty orders without returning a clear finding that there was no concealment in respect of each year.

Conclusion: The provision of section 28(1)(c) was applicable and the reference was answered against the assessee and in favour of the revenue.

Ratio Decidendi: Unexplained accretion to wealth may justify a finding of concealment of income, and an estimated or ad hoc reassessment does not preclude penalty unless there is a clear finding that no concealment or furnishing of inaccurate particulars occurred for the relevant assessment years.

---