1996 (4) TMI 28

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....e instance of the Revenue and the following questions have been referred for answer by this Court : "1. Whether on the facts and in the circumstances of the case, the Tribunal was right in holding that after amendment from 1st April, 1976, unless and otherwise a positive evidence is found that the assessee's declared income is not true or accurate, no penalty is envisaged? 2. Whether on the ....

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.... then approached appellate authority which cancelled the penalty. Aggrieved by this order, the Department approached the Tribunal which affirmed the order of the CIT(A) and set aside the penalty. The Department then approached the Tribunal for making a reference to this Court in view of the amendment to Expln. 1 to s. 271 of the Act and referred the aforesaid two questions for answer by this Court....

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....lure; (iii) in the cases referred to in cl. (c) 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 particulars of such income. Thereafter Expln. 1 was inserted with which we are concerned. It says that i....

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....ned authority, on the material before it, finds that the explanation offered by the assessee is false, then penalty can be levied on the amount which is found to be concealed. Therefore, the whole idea behind the Expln. 1 is that the assessing authority has to first record reasons for arriving at a conclusion that there is a failure on the part of the assessee. Hence after seeking explanation if t....