Penalty under section 271(1)(c) requires proof of concealment or inaccurate particulars, not merely a surviving addition.

Penalty under section 271(1)(c) was considered unsustainable where the underlying section 69 addition for unexplained investment was treated as debatable and the assessee had offered an explanation with supporting evidence during assessment. The text states that penalty does not follow automatically from the survival of a quantum addition; concealment of income or furnishing of inaccurate particulars must be established before penalty can be imposed. On that basis, the penalty was 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 in relation to the section 69 addition for unexplained investment.

Analysis: The addition giving rise to the penalty was treated as debatable in nature. It was noted that the assessee had offered an explanation with supporting evidence during assessment, and the case did not warrant penalty merely because the quantum addition survived. Penalty under section 271(1)(c) is not attracted in every case of disallowance or addition; concealment and furnishing of inaccurate particulars must be established.

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

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