9911796707
|
Home
Issues involved: Appeal against cancellation of penalty u/s.271(1)(c) of the Income-tax Act, 1961 for Assessment Year 2003-04.
Judgment Summary: Issue 1: Disallowance of Interest Expenses and Bad Debts The Assessing Officer levied a penalty of Rs. 6,00,000 u/s.271(1)(c) based on disallowances of Rs. 4,72,603 for interest expenses and Rs. 14,00,000 for bad debts. The Tribunal directed the bad debt of Rs. 14 lakhs to be treated as speculation loss to be carried forward. The CIT(A) found the percentage calculation by the Assessing Officer incorrect and allowed a portion of the interest expenses. The CIT(A) cancelled the penalty, stating that the additions were due to a difference of opinion and not concealment of income. The Tribunal upheld this decision, emphasizing that rejection of a claim does not equate to concealment. Issue 2: Justification for Penalty Cancellation The Revenue argued that even if the set-off of capital loss against business profits was due to negligence, penalty under u/s 271(1)(c) should not be deleted. Citing case law, the Tribunal held that penalty is imposed only for deliberate default, not mere mistakes. As there was no concealment or submission of inaccurate particulars, the CIT(A) rightly cancelled the penalty. The Tribunal upheld this decision, dismissing the Revenue's appeal. In conclusion, the Tribunal upheld the cancellation of the penalty u/s.271(1)(c) as there was no concealment of income or submission of inaccurate particulars, based on the facts and circumstances of the case. This order was pronounced in open court on 24.07.09.
|
