1999 (9) TMI 41

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.... the assessee had not actually questioned that validity of such assessment by way of appeal against the assessment ? 2. Whether on the facts and in the circumstances of the case, the Tribunal was right in upholding the levy of penalty under s. 271(1)(c)?" 2. Assessee has filed return of income on 30th Oct., 1989, declaring total loss of Rs. 3,54,970. The assessment was proceeded under s. 143(1)(a) on 26th June, 1991. Proceedings for reassessment was taken in pursuance of the notice under s. 148. The return already filed was requested to be treated as in response to the notice under s. 148. Total loss was computed at Rs. 2,29,600 and penalty proceedings were initiated in respect of concealment of income to the extent of Rs. 1,25,319. After....

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....al by the CIT(A) and against that the appeal was pending before the Tribunal. There was no initiation of penalty proceedings for concealment by the Department during assessment proceedings. The prosecution which was launched was challenged by way of writ. Ultimately it was held that the proceedings were not maintainable and were accordingly dropped. 4. Sec. 271(1)(c) provides that if any person has concealed the particulars of his income or furnished inaccurate particulars of such income than in addition to any tax payable by him, a sum which shall not be less than, but which shall not exceed three times the amount of tax sought to be evaded by reason of the concealment of particulars of his income or the furnishing of inaccurate. particul....

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.... not allowed in assessment proceedings. 6. It is contended that income in s. 271(1)(c) should be of positive figure. In CIT vs. Prithpal Singh & Co. (1990) 85 CTR (P&H) 26 : (1990) 183 ITR 69 (P&H) TC 50R.236 the Punjab & Haryana High Court held that the income as envisaged in s. 271(1)(c) means positive income. If the loss declared has been reduced penalty under s. 271(1)(c) cannot be levied. This decision is in respect of asst. yr. 1970-71 i.e., before the insertion of above explanation and hence cannot help the case of the assessee. For the same reason the decisions given in CIT vs. India Sea Food (1976) 105 ITR 708 (Kar) : TC 50R. 148, asst. yr. 1968-69, CIT vs. C.R. Niranjan (1990) 84 CTR 259 (Mad) : (1991) 187 ITR 280 (Mad) : TC 50R.....