T.V. RAJAGOPALA RAO, J.M. This is penalty appeal filed by assessee and it is directed against order dt. 14th May, 1985 passed by Commissioner (A), Visakhapatnam for asst. yr. 1976-77. 2 . assessee constructed cinema theatre called Tulsiram Delux Theatre at Ongole. construction began on 15th Dec., 1973 and completed on 15th Jan., 1976. assessee maintained regular books of account and cost of construction of said cinema theatre was recorded in books of account of assessee at Rs. 4,94,495. For asst. yr. 1976-77 for which previous year ended by 31st March, 1976 assessee returned loss of Rs. 72,140. ITO referred question of valuation of construction of theatre, Tulsiram Delux Theatre, Ongole, to Departmental valuation cell. They had estimated its value at Rs. 7,03,000. Then ITO completed assessment against assessee at plus income of Rs. 1,37,840 in following manner. Firstly he had accepted valuation of departmental valuation cell at Rs. 7,03,000. He had deleted book value of Rs. 4,94,495 and from resultant figure of Rs. 2,08,505 he had accepted returned loss at Rs. 72,140 and determined unexplained investment of assessee at Rs. 1,37,840. Regarding following six items of building material cost adopted by departmental valuer and excess worked out was as follows: Shown Name of Adopted by Excess item by valuer appellant Rs. Rs. Rs. 1. Stell for 1,26,800 1,45,388 12,688 RCC, etc. 2. Wood, plaster of paris 1, 27 1,57,658 30,508 and glass ,150 materials 3. Bricks 42,000 71,142 29,142 4. A.C. 3,000 12,000 9,000 Sheets 5. Misc, items lime CC 26,000 46,600 20,600 pump etc. 6. 67,134 92,850 25,716 Electrification Total 3,92,084 5,25,638 1,33,55 3. In appeal before ld. CIT(A) cost of construction with regard to sum of Rs. 1,70,000 was disputed. CIT(A) inferentially held that assessee had no objection for taking cost of construction of cinema theatre at Rs. 5,33,000 (Rs. 7,03,000 1,70,000). Therefore, he held that difference between Rs. 5,33,000 and Rs. 44,994,495 viz., Rs. 38,505 was taken to be addition for which assessee had no objection. As regards six items o f expenditure mentioned in table given above ld. CIT(A) reduced excess as regards first item from Rs. 18,588 to Rs. 8,588 and as regards third item be reduced excess from Rs. 29,142 to Rs. 5,000 and confirmed additions made with regard to other items and thus gave part relief to assessee in appeal filed before him. 4. assessee went in further appeal before this Tribunal. This Tribunal knocked off excess sustained by lower authorities as regards items 1 to 3 in table given above. excess of Rs. 9,000 as against fourth item in table given above was also knocked off by Tribunal. total of 5th and 6th items now given in table above plus Rs. 38,505 which is said to be admitted amount by assessee towards increased cost of construction of cinema theatre came to Rs. 84,821. From out of total of Rs. 84,821 he gave relief of Rs. 24,821 and sustained addition of Rs. 60,000 towards unexplained investment on cost of construction of cinema theatre. We distributed unexplained cost of construction for both assessment years during which construction of cinema theatre was undertaken and completed viz., asst. yrs. 1975-76 and 1976-77. We have passed these orders in quantum appeal filed by assessee in ITA No. 956 (Hyd) 1984 by our orders dt. 8th Nov., 1985. One of us, (Judicial Member) is party to said orders. consequential orders pursuant to our orders in quantum appeals were reported not to have been as yet passed by ITO. If our orders in quantum appeal are to be implemented and given effect to ITO should accept returned loss at Rs. 42,140, i.e., minus Rs. 72,140 plus Rs. 33,000 addition sustained towards unexplained investment of construction of cinema theatre is equivalent to Rs. 42,140. 5 . ITO initiated penalty proceedings even during course of assessment proceedings under s. 27 1(1)((c) r/w s. 27 4. explanation was also filed by assessee firm to penalty notice issued. ITO ultimately held that assessee was guilty of having concealed income by furnishing inaccurate particulars of cost of construction of theatre and render itself liable for penalty under s. 27 1(1)(C)(iii) andExpln. 1thereunder for failure to disclose correct expenditure for construction of theatre which has been considered as income under s. 69B. By time ITO passed penalty orders dt. 24th Sept., 1984 CIT(A) only disposed of quantum appeal filed before him and thus taking order of ld. CIT(A) in quantum appeal into consideration ITO levied penalty of Rs. 81,580 under s. 27 1(1)(c)(iii) andExplanationthereunder. penalty order was passed after purporting to have got approval of IAC, Nellore. Aggrieved against penalty orders d t . 24th Sept., 1984 assessee went in appeal before CIT(A), Visakhapatnam who by his impugned orders dt. 14th May, 1985 ultimately dismissed appeal. Further aggrieved by impugned orders of CIT(A) present second appeal is filed by assessee and thus matters stands for our consideration. 6. It is contended by Shri M.J. Swamy, ld. counsel for assessee that addition was made purely on estimate basis. When asset is valued especially on estimate basis where is likelihood of divergent opinions emerging regarding cost of construction of building like cinema hall. assessee firm had maintained its own books of account and it had not started its business. There is no question of any concealed income having been possessed by assessee firm prior to formation of partnership. Therefore there is no question of any concealment of particulars of income much less their disproving that so-called concealed income constituted income of assessee firm. He argued that for concealment there should be conscience on part of assessee and it should be deliberate act on part of assessee. Secondly, Shri Swamy contended that assuming without admitting there is conscious concealment on part of assessee firm in recording cost of construction of cinema theatre in its books of account stillExpln.4 under s. 27 1 (1)(c)(iii) does come into operation. In view of fact that concealed income of Rs. 30,000 did not exceed total loss returned. In order to correctly appreciate argument of Shri Swamy relevant provision has to be extracted which is as follows:Expln.4(a) to s. 27 1(1)(c)(iii) read as under: If ITO or AAC or Commissioner (A) in course of any proceedings under this Act is satisfied that any person (s) has concealed particulars of his income or furnished inaccurate particulars of such income, he may direct that such person shall pay by way of penalty. (iii) in cases referred to in clause (c), in addition to any tax payable by him, sum which shall not be less than, but which shall not exceed twice, amount of tax sought to have evaded by reason of concealment of particulars of his income or furnishing of inaccurate particulars of such income: Provided that if in case falling under clause (c) amount of income (as determined by ITO on assessment) in respect of which particulars have been concealed or inaccurate particulars have been furnished exceeds sum of twenty-five thousand rupees, ITO shall not issue any direction for payment by way of penalty without previous approval of inspecting Asstt. Commissioner. Expln.4 For purposes of clause(iii) of this sub-section for expression 'the amount of tax sought to be evaded (a) In any case where amount of income in respect of which particulars have been concealed or inaccurate particulars have been furnished exceeds total income assessed, means tax that would have been chargeon income in respect of which particulars have been concealed or inaccurate particulars have been furnished had such income been total income., In order to explain meaning of theExplanationin its correct perspective ld. counsel had given four illustrations: Illustration Business (-) 50,000 No. 1 loss Concealed . (+) 1,00,000 income Assessable . . 1,50,000 income Illustration Business (-) 50,000 No. 2 loss Concealed . (+) 51,000 income Assessable . (+) 1,000 income Illustration Business (-) 50,000 No. 3 loss Concealed . (+) 40,000 income Assessable . . 10,000 income in case of ppellant Business Illustration (-) 50,000 70,000 loss Concealed No. 4 (+) 20,000 30,000 income Assessable . . 30,000 40,000 loss In above illustrations he stated that in first two instancesExpln 4(a)applies for obvious reason that concealed income is more than total income assessed. As can be seen from above two illustrations assessed income is loss of Rs. 50,000 in each case whereas concealed income exceeds assessed income in both cases. In first illustration concealed income was Rs. 1 lakh and in second illustration these concealed income was Rs. 51,000. Inasmuch concealed income exceeds assessed income then these cases are directly attracted by provisions ofExpln. 4(A)mentioned above. However, illustrations 3 and 4 given by ld. Counsel against business losses incurred or assessed incomes were losses of Rs. 50,000, in each of cases or illustrations. However, concealed income falls short of assessed income. In illustration No. 3 concealed income was only Rs. 400,00 which is lesser figure than Rs. 50,000 and in 4th illustration concealed income was of Rs. 20,000 which is admittedly lesser than Rs. 50,000. It is contention of Mr. Swamy thatExpln. 4(A)comes into operation only where concealed income exceeds total income assessed and not otherwise. Now in order to substantiate contention that loss returned also when accepted amounted to total income assessed, he invited our attention to decision of Hon'ble Supreme Court inCIT vs. Harprasad & Co. P. Ltd. 1975 CTR (SC) 65 : (1975) 99 ITR 118 at 124 (SC).The Supreme Court held as follows: "From charging provisions of Act, it is discernible that words 'income or profits and gains' should be understood as including losses also, so that, in one sense 'profits and gains' represent 'plus income' whereas losses represent 'minus income'. In other words, loss is negative profit. Both positive and negative profits are of revenue character. Both must enter into computation, wherever it becomes material in same mode of taxable income of assessee". Therefore on basis of above ratio it is argued that even loss which is negative profit would be computed in order to arrive at taxable income of assessee or total income of assessee. ld. Departmental Representative contended that when assessee itself had accepted cost of construction at Rs. 5,33,000 said fact would become proof positive to show that assessee had admitted that there was every justification for addition of Rs. 38,505. He argued that Tribunal categorically found that addition of Rs. 60,000 confirms by them should be treated as addition made under s. 69B. In such case no burden lay on Department to prove conscious concealment on part of assessee. On other hand, it is for assessee to prove hisbona fidesin not entering sustained addition in its accounts books. ld. Departmental representative also relied upon decision of Calcutta High Court inSri Loknath Chowdhary vs. CIT (1986) 50 CTR (Cal) 340 : (1985) 155 ITR 291 (Cal). Calcutta High Court speaking on question of onus on addition made under s. 69 of IT Act held as follows as per head-note: "When addition is made to income of assessee as unexplained investment under provisions of s. 69 of IT Act, 1961, such addition is deemed to be income of assessee for purposes of levy of penalty. But when addition is made under s. 68 of Act, it will not be deemed to be income at assessee for levy of penalty. If unexplained investment is deemed to be income of assessee under s. 69, there is no further onus on IT Department to prove that such principles laid down by Supreme Court inCIT vs. Anwar All (1970) 76 ITR 696 (SC)will not apply". That was also case where two brothers constructed building in two previous years. ITO did not accept cost of construction and its value is estimated by departmental valuer. When assessee was confronted with various points on which departmental valuer differed from assessee's approved valuer assessee could not given any satisfactory explanation to any of infirmities pointed out by departmental valuer. So far asst. yr. 1975-76 sum of Rs. 71,203 was treated as unexplained investment of assessee under s. 69. Penalty for concealment of income was imposed and it was confirmed by Tribunal. Calcutta High Court held that levy of penalty was valid. Therefore ld. Departmental representative urged that same ratio may be followed by this Tribunal and penalty may be levied. He also argued that interpretation sought to be put by Shri M.J. Swamy onExpln.4(a) of s. 27 1(1)(Iii) is not correct. According to him, in all such cases tax on concealed income should be taken to be penalty which can be legitimately levied against assessee. Therefore from facts and circumstances of this case he argues that tax leviable on Rs. 30,000 can be levied as penalty against assessee irrespective of fact whether it exceeds total income or not as, in his opinion, it amounts to tax that is sought to be evaded either by concealed income or by furnishing inaccurate particulars of income. 7 . We have considered and pondered over respective arguments advanced before us. As regards burden of proof, it is no doubt true that addition of Rs. 60,000 which was spread over asst. yrs. 1975-76 and 1976-77 was made specifically under s. 6 B. Therefore, following Calcutta High Court decision we have to hold that there is no extra burden on part of Department to prove about concealment of income or to prove fact that concealed income constitutes income of assessee. However, on question of quantifying penalty, in our opinion, it should be done only in strict compliance ofExpln. 4(a) already extracted above. To our minds if ld. Departmental representative's arguments is to be accepted then certain words especially words exceeds total income assessed, would become redundant or will have to be ignored. construction which renders some of provisions of statute redundant should always be avoided and that construction which gives full meaning to every word used in provision of law would have to be preferred. If construction sought to be put by Shri M.J. Swamy ld. Counsel for assessee is adopted, as correct one than every word used inExpln. 4(a) would have meaning and none of words of said provision would become either redundant or surplus. While interpreting statutes it is c o m m o n knowledge that Courts should avoid ascribing redundancy to legislature. Even on fair reading it is very clear to our minds thatExpln.4(a) comes into operation only when concealed income exceeds total income assessed. In case where concealed income does not exceed total income assessed, it would not come into operation. In last two illustrations already extracted above given by ld. Counsel for assessee concealed income is less than total income assessed especially when we take loss as negative income in view of ratio held by Hon'ble Supreme Court inCIT vs. Harprasad and Co. P. Ltd. 1975 CTR (SC) 65, (1975) 99 ITR 118 (SC). Therefore to our minds it would appears that none of provisions of s. 27 1(1)(c) appear to be applicable either to quantify penalty or to authorise levy of penalty in case like present one before us. Under circumstances, as penalty proceedings under s. 27 1(1)(C) are quasi criminal in nature unless there are clear provisions authorising levy of penalty, Tribunals are not entitled to levy penalty. InCIT vs. B.C. Srinivasa Setty (1981) 21 CTR (SC) 138 : (1981) 128 ITR 294 (SC),the Supreme Court held that charging section and computation provisions together constitute integrated Code. When there is case to which computation provisions cannot apply at all, it is evident that such case was not intended to fall within charging section. This principle directly applies to facts of present case, in our humble opinion. We therefore hold that as there is no machinery provision for computing quantum of penalty in case like present one before us there is no scope for levy of penalty at all. In result, appeal is allowed and penalty is knocked off. *** TULSIRAM DELUX THEATRE v. INCOME TAX OFFICER