Rajasthan High Court - Jaipur
Commissioner Of Income Tax vs Smt. Shakuntala Devi on 21 April, 2003
Equivalent citations: (2003)183CTR(RAJ)520, [2004]270ITR590(RAJ)
JUDGMENT
1. On an application under Section 256(1) of the IT Act, 1961, Tribunal has referred the following question for the opinion of this Court :
"Whether, in the facts and circumstances of the case, the Tribunal was justified in cancelling the penalty of Rs. 85,000 imposed by the IAC under Section 271(1)(c) of the IT Act, 1961 ?"
2. The assessee late Dr. L.M. Simlot was a medical practitioner. The relevant assessment year is 1966-67. In that year, he was also an employee of the Government of Rajasthan. In the returns, he has shown income from salary as well as from private practice.
3. The assessee did not maintain any regular books of accounts in respect of his private practice. The assessee filed returns and those returns were revised thrice and different figures of income has been shown in the returns. The ITO had in his possession information that the assessee had issued certificates to the employees of postal department and gross receipts were Rs. 1,09,489. This fact was brought to the notice of the assessee, He simply replied that he has not received to total amount of receipts issued by him, but he has received only the amount he has shown in the returns. ITO has taxed the income of Rs. 1,09,489 as income from profession. That has been upheld by the AAC. In appeal, the Tribunal has reduced this figure from private practice to Rs. 1,05,000.
4. The penalty proceedings under Section 271(1)(c) of the IT Act have been initiated and after hearing and considering the submissions, the AO has imposed the penalty of Rs. 85,000. That penalty has been cancelled by the Tribunal finally in the appeal. While cancelling the penalty, the Tribunal observed as under:
"It would, in our opinion, be not possible to say that the assessee was trying to withhold primary facts from the Department with a view to conceal his income. If the assessee had not indicated the gross realisable fees in the very first return and his actual realisations therefrom there could have been some justification for the charge of concealment. But when he showed the figure of gross realisables as well as the actual realised amount, according to him, he placed the facts as he saw them at the relevant time before the Department squarely and, in our opinion, it would not be realisable to say, on these facts, that the assessee had attempted to conceal particulars of his income or to furnish inaccurate particulars of his income. We, therefore, feel that, on the facts of the present case, the imposition of penalty in terms of Section 271(1)(c) was not justified. We, accordingly cancel it."
5. Mr. Singhi, learned counsel for the Department, submits that as assessee has received Rs. 1,08,489 from the employees of the various Departments and that has been confirmed from those concerned departments, there is a clear case of concealment and Tribunal has wrongly cancelled the penalty.
6. Mr. Singhal, learned counsel for the assessee, submits that though the assessee has issued the receipts of that amount to the employees but they have not paid that much amount to him. Therefore, he has shown only Rs. 43.802 as receipts from Government employees. He supported the order of Tribunal.
7. The details of the income of assessee as shown in the original return and 3 revised returns read as under:
Date of filing return Income from salary Income from profession Total Rs.
Rs.
Rs.
Original 16-11-1996 5,299 50,000 55,299 Revised 31-12-1966 4,550 48,802 53,352 Revised 31-1-1967 5,299 25,000 30,299 Revised 12-4-1968 4,550 43,802 53,352
8. The case of the assessee that he has shown in the return, gross receipt of Rs. 93,000 and the net receipt of Rs. 43,802 in the final revised return.
9. Even if we give benefit to him to the fact that he has disclosed these particular figures. On those figures no case of concealment of income is made out, but that case be accepted uptil the amount he has shown i.e., Rs. 93,802. But there is no explanation for the concealment of income to the tune of Rs. 11,198 i.e., a difference of gross income he has shown in return i.e., Rs. 93,802 and the final figure of income from profession i.e., Rs. 1,05,000 taken by the Tribunal.
10. There is no further challenge of that addition. Therefore, even if we accept the explanation that there was no concealment for penalty uptil Rs. 93,802 as income from profession, but figure exceeding that amount is definitely a. concealment of income and liable for the penalty under Section 271(1)(c) of the Act, for which there is no explanation.
11. In the result, we answer the question that Tribunal was justified in cancelling the penalty of Rs. 85,000 imposed by the IAC, but considering the admitted facts there was a concealment of income of Rs. 11,198, the penalty is thus reduced to the figure of Rs. 11,198. We answer accordingly.