COMMISSIONER OF INCOME TAX Vs. AMALENDU PAUL

JUDGEMENT

(1.) In this reference under Section 256(2) of the I.T. Act, 1961, the following question has been referred to this court:

(2.) The facts of this case are as follows : The assessee had filed originally a return on June 28, 1963, declaring an income of Rs. 45,251. The ITO noticed cash credits aggregating to Rs. 35,000 which were claimed to be a loan taken from one Sri Sudhangshu Mandal. The assessee was required to prove the source of the credits and summons under Section 131 of the I.T. Act, 1961, was also issued in this connection. The assessee later requested the ITO to issue summons to another address which was stated to be a new address of the creditor concerned, but still failing to secure the attendance of the creditor to substantiate his contention regarding the source of the creditors, he submitted a revised return on December 16, 1967, including therein the credit of Rs. 35,000 as his income. The assessment was completed including the amount of Rs. 35,000 offered by the assessee for taxation. The IAC in levying penalty rejected the contention of the assessee that no penalty should be levied in this case as the assessee had voluntarily surrendered the amount in the revised return, on the ground that the assessee filed the revised return only after the ITO started investigation and when the assessee had no other course open as he was caught. In the circumstances, the IAC held that the assessee was guilty of concealing the income in the original return filed by him. He, consequently, levied a penalty of Rs. 14,419 under Section 271(1)(c) read with Section 274(2) of the I.T. Act, 1961.

(3.) The assessee preferred an appeal before the Appellate Tribunal. The Tribunal observed as follows: