TaxTMI 
TaxTMI 
2011 (6) TMI 501
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....ere seized. It was found that the assessee had not filed his return of income for the assessment year 1992-93. In response to the notice under s.148 dated 8.2.1995, issued by the Assessing Officer, the assessee filed return of income on 4.4.1995, declaring a total income of Rs.45,455. In the assessment that has ultimately been completed under s.143(3) read with s.250 of the Income-tax Act, the Assessing Officer determined the taxable income of the assessee at Rs.5,20,460, after making the following additions/disallowances- 1. Disallowance of plotting, stoning and cleaning expenses on estimate basis Rs. 5,000 2. Disallowance of expenses incurred for culvert, trenching and planting of trees Rs. 15,000 3. Disallowance of conveyance expenses on estimate basis Rs. 5,000 4. Disallowance of Administrative expenses on estimate basis Rs. 10,000 5. Addition towards unexplained expenditure incurred for daughter's marriage Rs.2,00,000 6. Addition made on account of unexplained credits, which were claimed to have been received on account of- (a) Loan from Y. Venkateswara Rao Rs. 50,000 Rs.2,40,000 (b) L....
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.... learned Departmental Representative, on the other hand, strongly supporting the orders of the lower authorities submitted that it is a fit case for the levy of penalty for concealment, since the assessee has not even filed the return of income, in time and could not adduce evidence in support of his claim with regard to either expenses claimed or the credits. He relied on the following judgements: 1. Surender Paul v. CIT [2006] 287 ITR 223/155 Taxman 385 (Punj. & Har.) 2. CIT v. R. Kesavan Nair [2006] 287 ITR 276/156 Taxman 172 (Ker.) 3. Ashok Kumar Gupta v. CIT [2006] 287 ITR 376/157 Taxman 339 (Punj. & Har.) 4. Ravi & Co. v. Asstt. CIT [2004] 271 ITR 286/[2005] 143 Taxman 287 (Mad.) 5. CIT v. Smt. Chandrakanta [1994] 205 ITR 607 (MP) 6. Prempal Gandhi v. CIT [2009] 185 Taxman 64 (Punj. & Har.) 9. We have considered the rival submissions and perused the orders of the lower authorities and other material on record. It is an undisputed fact that the impugned penalty has been levied with reference to the income disclosed in the return filed in response to notice under s.148, estimated additi....
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....hat was added was in fact concealed income of the assessee. Explanation to Section 271(1) (c) provides for deeming addition as concealed income or income in respect of which inaccurate particulars have been furnished provided conditions laid down in either of the clauses are satisfied. If assessee does not furnish any explanation, in respect of addition made, or explanation furnished is found false, then clause (A) Explanation 1 can be invoked. Where assessee furnishes an Explanation in respect of addition made, then as per clause (B) of Explanation 1, the addition would be deemed as concealed income or income in respect of which inaccurate particulars have been furnished, provided following three conditions are satisfied: (i) Assessee is not able to substantiate his explanation (ii) Explanation furnished by him is not bona fide (iii) All the material facts, necessary for assessment, or in respect of explanation, are not furnished by him. If assessee is able to show prima facie that he is neither hit by clause (A) or by clause. (B) of Explanation 1, then onus will shift to the Assessing Officer that condition laid down therein are satisfied. ....
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....led him to furnish the evidence in support of his claim. The third condition is that all the facts relating to the claim and material to the computation of its total income has been disclosed by him. It means that all the material facts which are relevant for computation of income of the assessee have been disclosed to the department not merely during the assessment proceedings but in the return of income. 12. When we examine the facts of the present case, as observed by the Tribunal in its order dated 10.8.2004 in ITA Nos.47 & 48/H/2002 that the amounts were advanced in the year 1987, 1988 and 1989. The assessee's wife in reply to question No.8, in her statement recorded on 4.11.1993, which is at page -14 of the APB stated that the loan of Rs. 50,000 from T. Venkateswara Rao as well as Rs. 50,000 from Kinnera Hotel and the amount of Rs.1 lakh from Mr. Ramabrahman were taken about 7 years ago. Thus, these three loans were not taken during the year and, thus cannot be said to be a source for investment in the purchase of land during the year. There is no proximity of source whatsoever. Even otherwise, the assessee has not led any evidence to prove the identity of the creditor, th....