TaxTMI 
TaxTMI 
2010 (8) TMI 75
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.... Assessing Officer, in the proceedings initiated by him under section 271(1)(c) of the Income-tax Act, 1961 has imposed penalty upon the asses-see herein for the concealment of income in respect of the assessment year 1979-80. The Commissioner of Income-tax (Appeals) had affirmed this penalty. However, the Income-tax Appellate Tribunal has set aside the penalty order. The Revenue has approached this court by moving petition under section 256(2) of the Act seeking reference, which petition was allowed, vide order dated January 7, 1991, and direction was given to the Tribunal to draw a statement of case and refer the following question of law for the opinion of this court : "Whether the Tribunal was correct in law in deleting the penalty i....
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.... and the reasons because of which the said claim was disallowed. 4. We have already taken note of the reasons given by the Assessing Officer in disallowing the claim. To recapitulate in brief, the Assessing Officer found that no services were rendered by Mrs. Ritu Nanda as alleged for which she was purportedly given commission at 3 per cent. of the con-tract value. Furthermore, though the payment of commission was claimed as given to Mrs. Ritu Nanda as director of the company, at the relevant time when this contract from Iran was signed by the assessee, she was not even the director. In the appeal filed by the assessee, the Commissioner of Income-tax had disallowed part of the commission. Total commission which was claimed to have been p....
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....note that the Income-tax Appellate Tribunal also put its stamp of approval to the aforesaid findings. The relevant portion of the Income-tax Appellate Tribunal's order reads as under : "In fact no services has been rendered by Smt. Ritu Nanda and that expenditure by way of commission leaving apart that portion which had been paid to M/s. Jupiter Trading Corporation was not incurred for the purposes of business." 6. It was also observed that the payment was made to Smt. Ritu Nanda who was daughter-in-law of the managing director of the company and, thus, it was a bogus payment without any consideration. 7. We have examined the penalty proceedings keeping in view the afore-said aspects in mind and we are of the opinion that the order....
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....t of the assessee and in case the assessee chose to give excessive commission to Mrs. Ritu Nanda, that would call for penalty. Again, while making these observations, the Tribunal was swayed by the wrong fact that Mrs. Ritu Nanda had rendered services and the claim was not bogus but excessive. The findings given in the assessment proceedings are relevant and have probative value. Where the assessee produces no fresh evidence or presents any additional or fresh circumstance in the penalty proceedings, he would be deemed to have failed to discharge the onus placed on him and the levy of penalty could be justified (CIT v. M.Habibullah [1982] 136 ITR 716 (All)). Explanation 1 below section 271(1)(c) suggests that the assessee would ....
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....e levied. A fortiori, if there is a deliberate concealment and false/ inaccurate return was filed, which was revised after the assessee was exposed of the falsehood, it would be treated as concealment of income in the original return and would attract penalty even if revised return was filed before the assessment is completed. Likewise, where the claim made in the return appears to be ex facie bogus, it would be treated as case of concealment or inaccurate particulars and penalty proceedings would be justified." 10 .The law has developed to the extent that even if there is no concealment of income or furnishing of inaccurate particulars, but on the basis thereof the claim which is made is ex facie bogus, it may still attract penalty pro-....