Satish Chandra, C.J.
1. The Tribunal has referred the following questions of law to this court for opinion :
'1. Whether, on the facts and in the circumstances of the case, and in view of the fact that the return of income was filed on June 29, 1965, the Tribunal was light in holding that the Explanation added to Section 271(1)(c) of the Income-tax Act, 1961, by the Finance Act, 1964, with effect from April 1, 1964, could not be invoked in this case ?
2. Whether, on the facts and in the circumstances of the case, the Tribunal was justified in cancelling the order of penalty made under Section 271(1)(c) of the Income-tax Act, 1961 ?'
2. The matter ultimately reached the Tribunal. The Tribunal held that it was a case of revised return having been filed voluntarily and in the totality of circumstances, it is clear that there was no possibility of inferring concealment in this case. The fact that the assessee did not indicate in the first return that it was based on estimate subject to audit was in the circumstances not sufficient to outweigh the evidentiary value of the voluntary nature of the revised return filed before the ITO before he began hearing of the case.
3. In our view, this is a finding of fact and this finding is clearly justified. It may be observed that neither the ITO nor the AAC had found that the case of the assessee that, in fact, the books of account had not been closed and audited prior to the filing of the original return on July 31, 1964, (June 29, 1965 ?) was not believable. The findings of fact recorded by the Tribunal have not been challenged.
4. In this application, the question of law referred to us for opinion is as follows:
'Whether, on the facts and in the circumstances of the case, the Appellate Tribunal was justified in cancelling the penalty under Section 271(1)(c) of the Income-tax Act, 1961?'
5. The question is answered in the affirmative and in favour of the assessee and against the Department. There will be no order as to costs.
Suhas Chandra sen ,J.