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2013 (8) TMI 72 - ITAT AGRAPenalty u/s 271(1)(c) - inaccurate particulars of income on account of liability in the name of sundry creditor M/s Shri Ram Udyog - Held that:- The assessee has filed copy of the account of M/s Shri Ram Udyog for the assessment year under appeal to show that there was opening credit balance of Rs.94,758.60 as on 01.04.2004. At the end of the year, on 31.03.2005 there is credit balance of Rs.1,20,850/-. The assessee has also filed copy of the balance sheet of the preceding assessment year as on 31.03.2004 in which the credit balance on 31.03.2004 in the name of M/s Shri Ram Udyog is mentioned as Rs.94,758.60. Thus, the aforesaid amount is coming up from the preceding assessment year and was shown as opening balance in the account of the assessee on 01.04.2004. Therefore, not a transaction related to the assessment year under appeal even if the addition is maintained on quantum as was not pressed before CIT(A). Thus, the item which did not pertain to assessment year under appeal and was merely a opening balance in the assessment year under appeal which was coming up from the earlier year, cannot be considered for any purposes for fastening liability upon assessee. The books of account of assessee for preceding assessment year have not been doubted by the Revenue authorities. For opening balance no adverse view could be taken in the assessment year under appeal. The assessee has not failed to offer any explanation and the explanation of the assessee was not found to be false & has made bona-fide explanation based upon the entries in books of account maintained of the earlier years. As decided in M/s Rajasthan Spinning Weaving Mills [2009 (5) TMI 15 - SUPREME COURT OF INDIA] "on every demand penalty is not automatic.". Also the case of CIT Vs The Shahabad Coop. Sugar Mills [2009 (10) TMI 154 - PUNJAB & HARYANA HIGH COURT] held that making a wrong claim is not at par with concealment or giving of inaccurate information, which may call for levy of penalty under section 271(1)(c). Also see CIT Vs. Reliance Petro Products Pvt. Ltd. (2010 (3) TMI 80 - SUPREME COURT) wherein held mere making of a claim, which is not sustainable in law, by itself, will not amount to furnishing inaccurate particulars regarding the income of assessee. Thus penalty should not be imposed against the assessee. In favour of assessee.
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