TaxTMI 
TaxTMI 
1976 (2) TMI 42
X X X X Extracts X X X X
X X X X Extracts X X X X
....,426, which was reduced in appeal by Rs. 36,346 by the AAC. A further deduction of Rs. 20,000 was granted by the Tribunal in ITA No. 1494 (Ahd)/71-72, decided on 20th Oct., 1973. 3. The ITO after completing the assessment initiated action for levy of penalty under the provisions of s. 271(1)(c) of the Act and referred the matter to the IAC as the minimum penalty imposable exceeded Rs. 1,000. The IAC for the reasons set out in his order imposed the aforesaid penalty. 4. Being aggrieved the assessee has come up in appeal before us. In order to appreciate the controversy before us it is necessary to point out the facts in a little more detail. 5. The assessee firm deals in purchase and sale of land. It purchased 23,113 sq.yds. of land....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ied the receipt of this impugned amount. In his cross-examination on behalf of the assessee, Shri Krishnaprasad stuck to his guns. The ITO also examined Shri J.C. Vora, the Advocate and the legal adviser of the firm, who is stated to have made the impugned payment in presence of witnesses. On examination of the witnesses, it was found that there was no evidence to support the plea taken by the assessee that the impugned payment was in fact made to Shri Krishnaprasad. In these circumstances, the ITO disallowed the claim. (ii) The next item of disallowance relates to a sum of Rs. 15,000 paid to Shri Keshavji Amthahi Vagri (hereinafter referred to as "Shri Vagri"). This amount was stated to have been paid to the said party for vacating the ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....i, as, according to him the payment was supported by receipt as well as by deposition. He also vacated the disallowance in respect of the payment made to Shri Manilal amounting to Rs. 5,500. This decision of the AAC was challenged in appeal before the Tribunal in ITA Nos. 1494 and 1542 (Ahd) of 1971-72. The Tribunal upheld the decision of the AAC. While upholding the addition of Rs. 80,000 paid to Shri Krishnaprasad the Tribunal at paragraph 7 of its order observed as follows:— "The foregoing facts clearly show that Krishnaprasad had clearly denied the receipt of the amount and in his cross-examination, he struck to his guns. there is some reference about the kachcha receipt alleged to have been passed by Shri Krishnaprasad, in one dep....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... his statement made before the Officer, but in the cross-examination in which he stuck to his guns, we are not persuaded to reach to a conclusion different then the one reached by the authorities below, on this point. We would, therefore, uphold the disallowance made by the authorities below." 7. Shri Bhatt, learned representative of the assessee urged before us that the levy of penalty in the instant case was not justified; firstly on the ground that there no was substantial evidence to hold that the payment made to Shri Krishnaprasad was not a genuine payment. He referred to the depositions made by various parties which the Tribunal had the occasion to consider in quantum appeal cited supra. Shri Bhatt next pointed out that as the asse....