T.S Thakur, J.:— The assessee is engaged in the production and sale of hybrid seeds. For the assessment year 1997-98, it appears to have claimed exemption from payment of income-tax under section 10(1) of the Income-tax, 1961 on the ground that the income derived by it was from “agricultural activities”. The Assessing Officer rejected that claim and brought to tax the amount of income disclosed by the assessee. Simultaneously, proceedings under section 271(1)(c) were also initiated which culminated in the levy of a penalty of Rs. 3,49,58,630. Aggrieved by the said order, the assessee appealed to the Commissioner of Income-tax (Appeals) who affirmed the penalty and dismissed the appeal. In a further appeal before the Income-tax Appellate Tribunal the assessee succeeded. The Tribunal upon appreciation of the facts and circumstances of the case held that the Department had not alleged any concealment or inaccurate furnishing of particulars of the assessee's income. It observed:
“It is nowhere the case of the Department that the assessee either made any covert concealment of its income or that it furnished any inaccurate particulars of its income. It is by way of analogy that the concealment has been imputed to the assessee by saying that in the light of the decision of Raja Benoy Kumar Sahas Roy, [1957] 32 ITR 466, the activity carried out by the assessee was not an agricultural activity. On the basis of this law of the land laid down by the Supreme Court, the assessee has been insinuated with the offence of concealment. Curiously though, the assessee has itself relied on Raja Benoy Kumar Sahas Roy, [1957] 32 ITR 466. It has been contended that the Supreme Court has, in very many details, discussed the concept of agriculture.”
2. The Tribunal further held that in the earlier assessment years the Department had treated the activity undertaken by the assessee to be agricultural activity and accordingly granted exemption to the income derived from the same.
3. Penalty for the year under consideration was, however, levied on the basis of a decision of the Supreme Court in CIT v. Raja Benoy Kumar Sahas Roy, [1957] 32 ITR 466 (SC). The assessee also incidentally relied upon the same judgment in support of the claim that its activities were agricultural in case. The Tribunal looking to the attendant circumstances concluded as under:
“Still further, the conduct of the assessee as well as the Department shows that there is no mens rea attributable to the assessee. The assessee has all through been laying bare all the facts pertaining to earn its income before the Tribunal, that even as much as scintilla of either suggestio falsi or suppressio vari. The assessee can, in no manner, be said not entitled to entertain a bona fide belief, which has been repeatedly accepted by the Department over the years.”
4. In the light of the above findings clearly holding that there was no deliberate concealment of the income nor any inaccurate furnishing of particulars of the income and that the assessee's perception that its activities were agricultural in nature and had been treated to be so for the previous years, no question of law can be said to arise for our consideration. This appeal accordingly fails and is hereby dismissed.