Commissioner of Income Tax vs Hind Grain Suppliers

Om Prakash, J.—By this application, the Commissioner of Income Tax requires us to direct the Income Tax Appellate Tribunal to state the case on the following questions :

"1. Whether, on the facts and in the circumstances of the case the Tribunal has misdirected itself in law in arriving at the finding that the penalty u/s 271(1)(c) would not be justified with reference to the first addition of Rs. 45,112 ?

Whether, on the facts and in the circumstances of the case, the Income Tax Appellate Tribunal was right in law in deciding that the proviso to Explanation 1 appended to Section 271(1)(c) is not attracted in the case of the second addition of Rs. 29,298 on account of discrepancy of 470 tins of vanaspati ? .

Whether, on the facts and in the circumstances of the case, the Income Tax Appellate Tribunal was right in law in deciding that Explanation 1 to Section 271(1)(c) does not result in the imposition of penalty for the third addition of Rs. 13,600 on account of shortage in '' boora khand '' account ?

Whether, on the facts and in the circumstances of the case, the Tribunal was justified in law in upholding the order of the Commissioner of Income Tax (Appeals) cancelling the levy of penalty of Rs. 57,000 ? "

The dispute relates to three additions amounting to Rs. 90,196, Rs. 31,484 and Rs. 13,600. So far as the first addition is concerned, it was made at the instance of the assessee because it voluntarily stated before the Income Tax Officer that due to a mistake in the calculation, the said amount could not be included in the return and the mistake was on the part of the then accountant of the assessee. Since the assessee itself offered this amount for being added, the addition was made. Regarding the remaining two other additions, the assessee gave an explanation which was rejected by the Income Tax Officer but was accepted by the appellate authority.

Normally, the question whether there is concealment or not is a question of fact unless there are some other grave errors of law. The submission of learned counsel for the Revenue is that in the instant case, Explanation 1 to Section 271(1)(c) of the Income Tax Act, 1961, is applicable, but the Tribunal erroneously found otherwise. The assessee furnished an explanation with regard to the additions made and the appellate authorities held the same to be a bona fide one. The question, whether the explanation offered by the assessee is bona fide or not, is a question of fact and no question of law arises therefrom.

On these facts, we do not see that the questions proposed by the Revenue are questions of law.

The application is, therefore, rejected.