TaxTMI 
TaxTMI 
1976 (12) TMI 75
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.... declaring an income of Rs. 1,953. During the pendency of the assessment proceedings she filed a revised return on 6th March, 1971 showing an income of Rs. 13,118. The assessment was completed on 20th Jan., 1972, on an income of Rs. 16,823. This was reduced in appeal to Rs. 15,323 by the Appellate Assistant Commissioner. 4. The difference in the original and the revised returns arose as she had in original return filed to disclose her income form reimbursement practice, i.e. the consultation fees charged by her from the Central Government employees. 5. Penalty proceedings were initiated under s. 271(1) (c) of the Income Tax Act of concealing particulars of income in the original return filed on 8th Dec., 1969. In her reply to the notice, ....
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....ore or less followed the same line of reasoning and observed that the gap between the original and the revised returns was "obviously very large and even though a revised return has been submitted the penalty is leviable on account of the default of concealment in the original return". 8. The short question for our consideration is whether penalty could be imposed on the basis of the original return even when the assessee had filed a revised return subsequently. Under s. 139(5) of the Act a revised return can be filed: "If any person having furnished a return under sub-s. (1) or sub-s. (2), discovers, any omission or any wrong statement therein." 9. Revised return for all purposes substitutes the original return and unless it is proved t....
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....s" used in s. 139(5) of the Act includes the element of "realisation" on the part of the assessee at a later date that whatever particulars he has given in his original return may be incorrect or inaccurate. This realisation may emanate either from his personal information or form legal advice. He may even file a revised return out of fear of detection of his real income. The touch-stone will ultimately be whether the revised return was voluntary or not. If the revised return is filed voluntarily, the assessee will be protected against the penal provisions of s. 271(1)(c) of the Act. For levying penalty, the department will have to prove that the revised return was not voluntary and was consequential to the detection of the assessee's incom....
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.... the revised return was filed by her. Even if it is assumed that the assessee having learnt about this enquiry concerning other doctors and fearing that her own income may be detected, filed the revised return, we think that the return so filed was still a voluntary return and not one filed after detection of concealed income by the department. 12. Learned Departmental Representative filed a copy of a letter dated 25th Nov, 1969 addressed by the assessee to the Income-Tax Officer wherein she had informed that her private practice was very poor. It appears that the assessee was distinguishing her income from private practice and that received from Government employees as to separate sources. This obviously was due to ignorance because in fa....
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....(2) will not apply since the foot-note in the revised return could not constitute as an admission that the assessee had concealed the particulars of her income. It also does not constitute an admission that the department had already detected her income from professional practice. The statement in the foot-note was of a general nature indicating only the willingness of the assessee to accept the estimate of income made by the department in respect of her income from practice. 14. The learned Departmental Representative cited a decision of the Gauhati High Court in F.C. Agarwal vs. CIT Assam(4). That the cause is distinguishable on facts because there the Tribunal had recorded a finding of facts that the staggering difference found in origi....
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....ission or wrong statement in the original return may be inadvertent or deliberate and this will have no effect on the validity of the revised return within the scope of s. 139(5) of the Act. According to us, if the assessee discovers, by any means including legal advice, that the omission or wrong statement might expose him to penal consequences, and, as a result of this knowledge, he voluntarily revises his income, he must be deemed to have duly complied with the legal requirement contemplated by s. 139(5) of the Act and he will not be liable for penalty for concealment of income. According to us, there is no justification for giving a narrow or restrictive concept of the plain language used in s. 139(5) of the Act which merely provides a ....