GULATI, J. In respect of the assessment year 1966-67 the as sessee filed a return disclosing an income of Rs. 47,773/ -. The In come-tax Officer did not accept the return and computed the total income at Rs. 85,995/ -. On appeal the assessees income was reduced by Rs. 11,120/ -. The Income-tax Officer initiated proceedings for the levy of penalty under Section 271 (1) (c) read with the Explanation. The Inspecting Assistant Commissioner of Income-tax, to whom the matter was transferred in accordance with Section 274 (2) of the Act, levied a penalty of Rs. 5,180/ -. The assessee appealed to the Income-tax Appellate Tribunal. The Tribunal has cancelled the penalty. The Department is aggrieved and at its instance the Tribunal has referred the following question: "whether on the facts and in the circumstance of the case, the Tribunal was justified in holding that the assessee was not guilty of gross or willful neglect within the meaning of Section 271 (1) (c) of the Income-tax Act, 1961 ?" The penalty under Section 271 (1) (c) of the Act can be levied, if the assessee conceals his income or furnishes inaccurate particu lars thereof. Thus to attract the penal provision, the onus lies on the Department to prove the concealment or deliberate furnishing of inadequate particulars by the assessee The mere enhancement of Income by the Income-tax Officer is no ground for levying a penalty. However, under the Explanation, if the income returned is less than 80% of the income assessed, after deducting certain expenditure bona fide claimed by the assessee and disallowed by the Income-tax Officer, it shall be deemed to be concealment of income, unless the assessee proves that the disparity in the income returned and assess ed was not due to fraud or gross or willful neglect on his part. When the Explanation applies, the onus lies upon the assessee to prove that the difference in the income returned and assessed is not due to fraud or gross or willful neglect on his part. The Inspect ing Assistant Commissioner of Income-tax held that even if the as sessee could not be held guilty of any fraud, he was definitely guilty of gross or willful neglect. The Tribunal has not agreed with this view and has held that the assessee was not guilty of any gross or willful neglect. The Inspect ing Assistant Commissioner of Income-tax held that even if the as sessee could not be held guilty of any fraud, he was definitely guilty of gross or willful neglect. The Tribunal has not agreed with this view and has held that the assessee was not guilty of any gross or willful neglect. Now, it is true that the onus lay upon the assessee, but the onus can be discharged by direct or circumstantial evidence. It appears that during the previous year one of the partners died and the asses see submitted two returns, one relating to the period before the death of the partner and the other after the death of the partner. The rates, of profits disclosed in the two returns were 5. 4% and 6. 8% res pectively. The Inspecting Assistant Commissioner of Income-tax noticed that the assessee had in the immediately proceeding year dis closed a profit of 8. 5%. From this he inferred that the assessee had not accounted for in the books of accounts the entire transactions and this, in his opinion, amounted to fraud. This inference drawn by the Inspecting Assistant Commissioner of Income-tax is wholly errone ous. It is a matter of common knowledge that rate of profit is not a constant factor. It keeps on varying from year to year depending on the trade conditions. The other circumstances relied upon by the Inspecting Assistant Commissioner was that the assessee had debited its profit and Loss A/c with a sum of Rs. 930/- on account of Income-tax and Us. 177/- on account of charity in the first set of accounts. Similarly in the se cond set of accounts it had debited a sum of Rs. 1001- on account of War Fund and Rs. 908/- on account of Income-tax. According to the Inspecting Assistant Commissioner of Income-tax, it was the duty of the assessee to add back these amounts to the assessable profits in the return filed by it and his failure to do so amounted to gross or willful neglect, even if he was not guilty of fraud. Here again the approach of the Inspecting Assistant Commissioner of Income-tax is not right. The expenditure incurred for payment of Income-tax and charity are, no doubt, not admissible deductions. Here again the approach of the Inspecting Assistant Commissioner of Income-tax is not right. The expenditure incurred for payment of Income-tax and charity are, no doubt, not admissible deductions. But merely be cause the assessee had failed to add them to the assessable profits does not, by any stretch of imagination, disclose gross or willful neglect. He had shown these items separately in the profits and Loss. A/c so that he made no attempt at concealment. At the most it can be said to be a case of neglect but not a case of gross or willful neg lect. Moreover, the amounts are too paltry to lead to the inference that the entire addition to the profits sustained ultimately by the Tri bunal was due to fraud or gross or willful neglect. It may be noted that the Tribunal had reduced the rate of profit to 6. 5% as against 7. 8% as applied by the Appellate Assistant Commissioner of Income-tax. Obviously the assessees account books were not found to con tain all the details and that is why the profit was worked out by ap plying a flat rate. In such a case normally the question of conceal ment does not arise. The finding recorded by the Tribunal that the assessee was not guilty of gross or willful neglect is a finding of fact and it is not possible to interfere with such a finding in a reference. It is not the case of the Department that the finding of the Tribunal is vitiated for want of material or evidence. So long as there is some evidence, circumstantial or direct on the basis of which the Tribunal can come to the conclusion that the assessee was not guilty of gross or willful neglect or fraud, this Court will not interfere with such a finding. In the circumstances we answer the question in the affirmative in favour of the assessee and against the Department. The assessee is entitled to the costs which we assess at Rs. 200/ -. .