Per Shri Pradeep Parikh, Accountant Member - The assessee is in appeal before us against the order of the learned CIT(A) dated 22-1-1990 for assessment year 1985-86. Though apparently there are four grounds, actually there is only one issue and it relates to the levy of penalty of Rs. 70,000 under section 271(1)(c) of the Income-tax Act, 1961 (the Act). Rest of the grounds are mere submissions and/or arguments and are dealt with at the appropriate places in this order.

2. The facts: The assessee M/s Parasmal Parekh, E-37, Shastri Nagar, Jodhpur was a registered firm engaged in contract work relating to Government Departments. It had secured a contract from the Improvement Trust, Jodhpur for the construction of Barkatullah Khan Stadium, Jodhpur. It came into existence in the assessment year 1984-85 under Deed date 30-10-1982 of Partnership. Its partners were S/Shri Parasmal Parekh, Kewalchand Jain and Banwar Ram. The firm is said to have been dissolved with effect from 1-5-1985. For the assessment year 1985-86 in question there were three accountants (Munims) in the said firm, namely, S/Shri Nemichand Sharma, Satya Narain Sharma and Rikhabmal Nahar. Out of these Shri Rikhabmal N