Case Law Details
RELEVANT PARAGRAPH
12. Section 271(1)(c) provides that if the AO or the Commissioner (Appeals) or the Commissioner, in the course of proceedings in this Act is satisfied that any person has concealed the particulars of his income or furnish inaccurate particulars of income, he may direct that such person shall pay by way of penalty a sum which shall not be less than but which shall not exceed three times the amount of tax sought to be evaded by a reason of the concealment of particulars of his income. Explanation 1 to section 271(1)(c) provides that where in respect of any facts material to the computation of the total income of any person under the Act, such person fails to offer an explanation or offers an explanation which is found by the AO or the Commissioner (Appeals) or the Commissioner to be false, or such person offers an explanation which he is not able to substantiate and fails to prove that such explanation is bonafide and that all the facts relating to the same and material to the computation of his total income have been disclosed by him, then the amount added or disallowed in computing the total income of such person as a result thereof shall for the purpose of clause (c) of sub section 271, be deemed to represent the income in respect of which particulars have been concealed. In other words/ the necessary elements for attracting Explanation 1 to sec. 271(1 )(c) may be stated as under
(i) The person fails to offer the explanation, or
(ii) He offers the explanation which is found by the AO or the
Commissioner (Appeals) or the Commissioner to be false, or (Hi) The person offers explanation which he is not able to substantiate and fails to prove that such explanation is bonafide and that all the facts relating to the same have been disclosed by him.
Please become a Premium member. If you are already a Premium member, login here to access the full content.
