Income Tax Appellate Tribunal - Jodhpur
Deputy Commissioner Of Income-Tax vs Madad Ali Ansari & Co. on 27 April, 2000
ORDER
S. R. Chauhan, J.M.
1. This appeal by the Revenue for asst. yr. 1986-87 is directed against the order of CIT(A), Jodhpur, dt. 17th March, 1992, whereby he deleted the penalty levied under s. 271(1)(c).
2. The assessee has returned the income at Rs. 4,82,520 whereas the AO by estimating the net profit at 12.5 per cent worked out profit at Rs. 6,90,722, resulting in an addition of Rs. 2,08,197. Accordingly the AO levied the penalty as aforesaid holding that there was a clear-cut case of concealment of income inasmuch as the outgoings shown in the books were not fully vouched, nor were fully verifiable, and in turn the true profits were not disclosed by the assessee. The learned CIT(A) deleted the penalty observing that there was no positive evidence on record to prove the concealment of contract receipts of fictitious nature of any expenses. Hence this appeal by the Revenue.
3. We have heard the arguments of both the sides and also perused the records.
4. The Revenue has raised only one ground disputing the cancellation of the penalty by the learned CIT(A). The learned Departmental Representative of Revenue has contended that there was an addition in the total income declared by the assessee and that there was concealment by the assessee in respect of the said addition. He has contended that the assessee is guilty of furnishing inaccurate particulars of income and that there is a concealment of income. He has contended that the penalty has not been levied for concealment of receipts. As against this the learned authorised representative of assessee has contended that all the contract receipts were disclosed before the authorities and that the difference (addition) is due to estimation of income by the AO treating the profit rate shown by the assessee to be low. He has contended that there is no material/evidence on record to show that there has been a concealment and that there is no positive finding of concealment of income. He has contended that in a case of assessed income being worked out at a figure higher than the declared income merely on the basis of estimation of profit treating the declared profit rate to be low it cannot be said that there has been any concealment of income and that in such a case no penalty for concealment can be levied under s. 271(1)(c) of the Act.
5. We have considered the rival contentions as also the relevant materials placed on record. In Asstt. CIT vs. Bansiwala Iron & Steel Re-Rolling Mills 21 Tax World 533 (Jp) a copy of which is placed on record, the Jaipur Bench of Tribunal has held that no penalty for concealment can be levied for application of higher g.p. rate unless there is positive finding of concealment of income based on concrete evidence. In Asstt. CIT vs. Karachi Kampatwala (1981) 127 ITR 421 (All), a copy of which is placed on record, it has been held that penalty under s. 271(1)(c) is imposable with reference to exact amount of income found concealed and not (sic-on) entire estimated income added. Considering all the facts and circumstances of the case including the fact that the gross contract receipts were not disputed and that no particular expenses were found to have been fictitious, as also respectfully following the aforesaid judicial pronouncements, we are of the opinion that it has not been established on record that there has been any conscious concealment of income. Accordingly, in our view, no penalty for concealment of income was justifiably leviable under s. 271(1)(c). As such the impugned order of the learned CIT(A) deleting the penalty levied under s. 271(1)(c) is found to be quite justified and suffering from no infirmity. We, therefore, make no interference therein.
6. In the result, this appeal of Revenue is dismissed.