2008 (7) TMI 469

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....ent is in appeal against the reduction of penalty to the extent of Rs. 43,72,498. 3. We have heard the rival submissions in the light of the material placed before us and the precedents relied upon. The assessee was practicing in Unani medicine. Search operation under section 132 of the Act was conducted on 23-1-2003 at the premises of the assessee. During the search certain documents showing suppression of professional receipts were found and seized. 4. In response to the notice under section 158BC of the Act, the assessee filed return of income for the block period on 31-12-2003 in which undisclosed income was declared at Rs. 69,40,422. The Assessing Officer passed order under section 158BC on 31-3-2005 in which the total undisclosed in....

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....relating to concealment of income will also apply. Penalty under section 158BFA(2) is not mandatory. It is discretionary. 7. In the case of Dhiraj Suri v. Addl. CIT [2006] 98 ITD 187 (Delhi), it was held that even if the assessee has not strictly complied with the conditions imposed by first proviso to section 158BFA(2) and even where second proviso is attracted, still it would be within powers of income-tax authority not to levy penalty having regard to bona fide of assessee's conduct, co-operation shown in completion of block assessment and general conduct of the assessee in the course of the assessment proceedings. 8. In the case of Dy. CIT v. Koatex Infrastructure Ltd. [2006] 100 ITD 510 (Mum.), it was held that in sub-section (2) of ....

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....ated deductions were given by the Commissioner (Appeals) and the Tribunal. Therefore, the residual figure assessed was only an estimated figure. It was vehemently argued that addition was sustained merely on the basis of quotation. There is absolutely no other material substantiating the factum of concealment. The Assessing Officer did not make any enquiry as to the veracity of the assessee's claim in regard to the quotations. The patients were not examined. There is no clear-cut proof that the assessee did receive the amount as shown in the quotation. As such it cannot be said that the factum of concealment was proved beyond the shadow of doubt. Our attention was also invited on the order of the Tribunal dated 21-9-2006 in IT (SS) A No. 94....

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.... are different from those that arise in assessment proceedings. The findings recorded in the assessment order constitute good evidence in the penalty proceedings but those findings cannot be regarded as conclusive for the purpose of the penalty proceedings. 12. It cannot be said that the process of imposition of penalty is automatic in the eventuality of estimated income. All the attendant circumstances of the case must be carefully scrutinized. The question whether penalty should be levied must be considered on the basis of the judicial determination. It must be proved beyond the shadow of doubt that there was actually income and further that income was not disclosed. The mere fact of addition on estimated basis, particularly when the ass....