COMMISSIONER OF INCOME TAX, MADRAS vs M/S. KHODAY ESWARSA & SONS

The Supreme Court held that under Section 28(1)(c) of the Income-tax Act, 1922, the burden is on the Department to prove that the assessee consciously concealed income or furnished inaccurate particulars before levying a penalty. The Court found that the Appellate Tribunal correctly set aside the penalty as the Department lacked cogent evidence beyond the original assessment order to establish deliberate concealment. Consequently, the appeal was dismissed, affirming the Tribunal's decision that the penalty was unjustified.