TaxTMI 
TaxTMI 
1985 (7) TMI 44
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....sessment years 1962-63, 1963-64 and 1964-65. 2. The facts, in brief, are that the assessee's books of account for the aforesaid assessment years were seized by the Sales Tax Department. Later, after the assessment under that Act had been completed, the seized books of account were released to one of the partners of the firm. It will be relevant to state here that the sales tax authorities formed conclusion that the assessee had done substantial clandestine business which had not been disclosed in the regular books of account in the proceeding for assessment under the Act. The assessee was called upon to produce books of account in terms of section 142(1)(i) of the Act. This notice was in relation to the account books which had been s....
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....n proceeded to impose penalty upon the assessee. The order of the Income-tax Officer was the subject-matter of appeal before the Appellate Assistant Commissioner. The Appellate Assistant Commissioner with some modification in the quantum of penalty upheld the order of the Income-tax Officer. That led to an appeal by the assessee to the Tribunal. The Tribunal allowed the appeal. The reasons given by the Tribunal for allowing the appeal in the penalty matter was, firstly, that the Department had failed to establish that there was any deliberate default on the part of the assessee in not producing the books of account ; secondly, that there was no mens rea in the non-production of the books of account and, lastly, that the imposition of penalt....
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....ection 271(1)(b) of the Act lays down that if the Income-tax Officer or the Appellate Assistant Commissioner, in the course of any proceeding under this Act, is satisfied that any person has without reasonable cause failed to comply with notice under sub-section (1) of section 142 of the Act, he may direct that such person shall pay penalty. The wordings of this section are explicit that a person who has failed to comply with the notice must show reasonable cause. The onus is upon the assessee. Onus may not be very heavy as it is upon the prosecution in a criminal case. That question of onus may be decided upon probability but it is for the assessee to show that there is reasonable cause. That may be shown either by fresh materials or by th....
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.... loss of account books was wholly unreliable. He also held in agreement with the Income-tax Officer that " the appellant failed without any reasonable cause to comply with the terms of the notice under section 142(1)(i) of the Act. It must be added that in the instant penalty proceeding as well, the assessee took no steps to establish that there was any reasonable cause for not complying with the notice under section 142 of the Act. Despite the findings in the assessment and the registration proceedings, we would have been inclined to consider whether there was any reasonable cause or not, but the entire record shows that no effort worth the name was made by the assessee to show that there was any reasonable cause. 8. The last aspect whi....