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of <h1>Penalty Cancelled for Undisclosed Investment and Margin Money; Voluntary Disclosure Accepted, Appeal Dismissed.</h1> <h3>Deputy Commissioner Of Income-Tax. Versus Rajan H. Shinde.</h3> Deputy Commissioner Of Income-Tax. Versus Rajan H. Shinde. - ITD 093, 001, TTJ 085, 178, Issues Involved:1. Cancellation of penalty u/s 271(1)(c) for undisclosed investment in Balaji Apartments.2. Unexplained margin money of Rs. 80,000 for the truck.Summary:Issue 1: Cancellation of penalty u/s 271(1)(c) for undisclosed investment in Balaji ApartmentsThe assessee's initial return declared NIL income. The assessment added Rs. 6,65,010 on a protective basis for unexplained investment in Balaji Apartments. The CIT(A) cancelled the penalty, concluding that the investment might belong to Shri Banne, not the assessee, and further enquiry was necessary. The assessee's disclosure was voluntary, following a settlement with Shri Banne. The Tribunal upheld the CIT(A)'s decision, noting the absence of independent evidence proving the assessee's concealment of income. The penalty was deemed unjustified as the disclosure was made under specific circumstances without evidence of intentional concealment.Issue 2: Unexplained margin money of Rs. 80,000 for the truckThe assessee failed to prove the source of Rs. 80,000 used as margin money for a truck. The CIT(A) found that the assessee had sufficient cash receipts to justify the investment and cancelled the penalty. The Tribunal agreed, noting the absence of books of accounts and accepting the cash flow statement provided by the assessee.Separate Judgment by Judicial Member:The Judicial Member disagreed with the majority, emphasizing that the assessee's disclosure came only after detailed investigation and was not voluntary. The penalty was justified due to the deliberate concealment of investment in Balaji Apartments and unexplained margin money for the truck. The Judicial Member argued that the CIT(A) erred in cancelling the penalty.Third Member Opinion:The Third Member concurred with the Accountant Member, emphasizing that the disclosure was voluntary and not due to any incriminating evidence found during the search. The penalty was not justified as there was no independent proof of concealment. The appeal was dismissed, and the CIT(A)'s order was upheld.
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