Concealment penalty upheld where undisclosed demand draft transactions surfaced only after investigation and the explanation lacked corroboration.

Penalty for concealment of income under section 271(1)(c) was sustained where unrecorded demand draft transactions were omitted from the original return and came to light only after departmental investigation and survey. The assessee's explanation that the sums were received from weavers for business purposes failed because it was unsupported by corroborative evidence and was not found bona fide. The later offer of additional income did not neutralise the earlier non-disclosure, and the subsequent return could not be treated as a valid revised return. The burden under the Explanation to section 271(1)(c) was not discharged, so the concealment penalty remained justified.

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Issues: Whether penalty for concealment of income under section 271(1)(c) was leviable where the assessee had not disclosed unrecorded demand draft transactions in the original return and later offered additional income after departmental investigation.

Analysis: The undisclosed demand draft purchases were not entered in the books and were not reflected in the original return. The additional income was offered only after investigation and survey had detected the transactions, and the explanation that the amounts were received from weavers for business purposes was found unsupported by any corroborative evidence. The plea of voluntary disclosure to buy peace was rejected because the concealment had already been unearthed, the explanation was not bona fide, and the assessee failed to discharge the burden cast by the Explanation to section 271(1)(c). The later return could not be treated as a valid revised return so as to neutralise the earlier non-disclosure.

Conclusion: Penalty under section 271(1)(c) was rightly upheld, and the issue was decided against the assessee.

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