Cit Vs. Laxmi Stores

counsels: l.m. lodha, for the revenue vineet kothari, for the assessee head note: income tax reference--question of factpenalty under section 271(1)(c)--on money not disclosed in return catch note: assessee collected money over and above printed price of cigarettes and remitted it back to the principal company--assessing officer finding that the said money was not disclosed in the return, made addition to the total income as concealed income and initiated penalty proceedings--tribunal set aside such order--justified--tribunal, on consideration of entire facts held that on money collected by assessee on behalf of the principal company was business compulsion of the assessee--further, finding that assessee had not concealed any part of his income for his own benefits--these being finding of facts, no question of law arose. ratio: whether where tribunal on consideration of entire facts, held that on money collected by assessee on behalf of principal company was business compulsion of assessee and since assessee had not concealed any part of its income for its own benefits, was purely a finding of fact and no question of law arose. case law analysis: cit v. r. c. gupta & co. (1980) 122 itr 567 (raj) application: not to current assessment year. decision: in favour of assessee. income tax act 1961 s.256(2) income tax act 1961 s.271(1)(c) in the rajasthan high court n.n. mathur & o.p. bishnoi, jj. - .....have heard mr. l.m. lodha, learned counsel for the revenue.2. this is a reference application under section 256(2) of the income tax act at the instance of the department.3. the respondent assessee firm deals in certain brands of cigarettes manufactured by m/s. godfray philips india ltd. during the search and seizure operation on, 9-1-1986, certain incriminating documents were found and they were seized. during the course of proceedings under section 132(5) the partners of the firm, namely, smt. bhagwani bai and shri nandlal admitted that the assessee-firm did not (sic) charge on money and a portion of the money so collected was retained by the firm. it was also admitted that the portion of the money so kept by the firm was not accounted in the books of accounts of the firm. the assessee did not disclose the said money in the return filed for the assessment year 1983-84. accordingly, the assessing officer added a sum of rs. 2,10,060 to the total income of the assessee as concealed income and initiated penalty proceedings for concealment while completing the assessment. the assessing authority also imposed a penalty of rs. 1,77,187. the order of assessing authority was confirmed by the commissioner (appeals). the appellate tribunal, jaipur, was of the view that it was not a fit case for imposing of penalty under section 271(1)(c) of the income tax act. accordingly, the tribunal set aside the order of the assessing authority.4. it is contended by mr. l.m. lodha, learned counsel for the department that once the concealment has been admitted by the assessee, there, was no option for the assessing authority to accept those penalties as per the mandate of section 271(1)(c) of the income tax act. learned counsel has also placed reliance on the decision of division bench of this court rendered in cit v. r.c. gupta & co. . from the facts it appears that the assessee was collecting on money over and above the printed price of cigarettes and was remitting the same to the.....