Penalty u/s 271(1)(c) should not be levied on the amount which was voluntarily surrendered by the assessee during survey

The facts in brief borne out from the record are that the assessee is a partnership firm engaged in the business of manufacturing and trading of bristles and brushes. Return of income was filed on 31.10.2006 showing Nil income and the same was processed under section 143(1) of the Act. A survey was conducted on 23.10.2007 at the premises of the assessee where from books of account and loose papers were impounded. During the course of survey, it was found that assessee has a large list of creditors, from whom purchase of raw bristles were made. During the course of survey, statement of Shri. Pa...