COMMISSIONER OF INCOME TAX Vs. M.M. GUJAMGADI

JUDGEMENT

(1.) THE Income Tax Appellate Tribunal, at the instance of the Revenue, has referred the following question of law for our opinion: Whether, on the facts and in the circumstances of the case, the Tribunal is right in holding that the Department could not establish the charge of concealment of income in respect of the unexplained cash credits in the books of the assessee and in that view in cancelling the penalty levied under Section 271(1)(c)?

(2.) FOR the assessment year 1993 -94, the assessee filed a return of income on December 23, 1993, declaring an income of Rs. 97,920. This return of income was taken up for scrutiny assessment. The Income Tax Officer found from the books of account of the assessee a sum of Rs. 2,01,000 and a notice was issued to the assessee to explain the same. The assessee submitted his reply stating that he has borrowed the sum of Rs. 2,01,000 from different creditors. Since the assessee failed to secure the creditors, he voluntarily offered to treat the same as cash credit. On the basis of the submission of the assessee, the Income Tax Officer passed an assessment order on August 3, 1994, computing the total income of the assessee at Rs. 2,99,500.

(3.) THE Tribunal has redrafted the question of law and referred it to this court as stated supra.