Concealment penalty requires proven inaccurate disclosure; acceptance of reassessment return without additions does not justify penal action.

Penalty for concealment of income or furnishing inaccurate particulars requires proof that the taxpayer concealed income or provided inaccurate particulars. Where a return filed in response to a reassessment notice is accepted without additions, disallowances, or adverse findings, filing that return after notice alone does not establish the statutory conditions for penalty. Payment of tax on declared income before the reassessment notice may support the absence of intent to evade tax. The analysis states that the Revenue must establish the basis for imposing the penalty, and that failure to do so makes the penalty unsustainable.

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Issues: Whether penalty for concealment of income or furnishing inaccurate particulars could be sustained where the return filed in response to reassessment notice was accepted without additions or disallowances.

Analysis: Penalty under Section 271(1)(c) requires establishment of concealment of income or furnishing of inaccurate particulars. The reassessment accepted the returned income in full, without any addition, disallowance, or adverse finding. Filing the return after issue of notice under Section 148, without proof of concealment or inaccurate particulars, was insufficient to attract the penalty provision. Payment of taxes on the declared income before issuance of the reassessment notice also supported the absence of intent to evade tax. The Revenue did not discharge its burden of establishing the statutory conditions for penalty.

Conclusion: The penalty under Section 271(1)(c) was unsustainable and was deleted in favour of the assessee.

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