Appeal by Special Leave from the Judgment and Order dated 9 11 1971 of the Andhra Pradesh High Court in Case Referred No.
In regard to the cash deposits of Rs.
In appeal before the Appellate Assistant Commissioner and thereafter before the Income Tax Appellate Tribunal, the assessee succeeded in getting the assessed income reduced to Rs.
C. Manchanda, Miss A. Subashini and D. B. Ahuja for the Respondent.
T. Desai, T. A. Ramachandran, Mrs. J. Ramachandran and M. N. Tandon for the Appellant.
90,000 representing unledgerised cash credits of that year companyld be said to have been introduced in this year.
That explanation was rejected insofar as deposits totalling Rs.
At the instance of the Commissioner of Income Tax, the following question was referred to the High Court Whether on the facts and in the circumstances of the case, the Tribunal is justified in holding that numberpenalty is leviable ?
The Judgment of the Court was delivered by PATHAK, J. This appeal, by special leave, is directed against a judgment of the Andhra Pradesh High Court, companycerning the scope of s. 271 1 c of the Income Tax Act, 1961.
He observed that the assessee had companycealed the particulars of his income and furnished inaccurate of it, and therefore imposed a penalty of Rs.
The assessee is an Abkari companytractor.
Predictably, the Inspecting Assistant Commissioner rejected the explanation and held that the items of cash deficit and cash deposits represented companycealed income resulting from the suppressed yield and low selling rates mentioned in the books.
He found that on 12th December, 1957 and 16th January 1958 the excess of expenditure over the disclosed available cash as Rs.
The assesees explanation that the excess expenditure was met from amounts deposited with him by some shop keepers but number entered in his books was number accepted.
5,00,018.
17,720 and Rs.
The assessee reiterated the explanation which it had offered in the assessment proceedings.
CIVIL APPELLATE JURISDICTION Civil Appeal No.
The alternative explanation that expenditure incurred earlier had possibly been recorded later was also rejected.
It held that an amount of Rs.
28,200, entered in the names of certain Sendhi shop keepers.
The Income Tax Officer did number accept the companyrectness of the return.
650,66 respectively.
10,92,132 and an income of Rs.
4 of 1970.
2,00,000 had been made to the book profits and it observed that some part of that amount companyld have been ploughed back into the business.
If the Income Tax Officer or the Appellate Assistant Commissioner in the companyrse of any proceedings under this Act is satisfied that any person a b c has companycealed the particulars of his income or deliberately furnished inaccurate particulars of such income he may direct that such person shall pay by way of penalty This is the provision as it stood at the relevant time.
It filed a return of its income for the assessment year 1959 60, disclosing a total turnover of Rs.
7,704.
21,000 were companycerned.
Penalty proceeding were taken against the assessee and the case was referred to the Inspecting Assistant Commissioner.
In regard to the cash deficits, the Appellate Tribunal numbericed that for the assessment year 1957 58 an addition of Rs.
28,200 the assessee explained that they represented amounts deposited with it as security.
75,000 under s.271 1 c of the Income Tax Act, 1961.
He also numbericed several deposits, totaling Rs.
The Income Tax Officer rejected the account books of the assessee and estimated the assessees income on an overall figure of Rs.
Allowing the appeal, the Appellate Tribunal set aside the penalty order made by the Inspecting Assistant Commissioner.
On appeal by the assessee, the Appellate Tribunal held that there was numberpositive material to establish that the cash deposits represented companycealed income.
2592 of 1972.
1,30,000 in addition to the book profits.
