9911796707
|
Home
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2017 (3) TMI 1581 - AT - Income TaxPenalty u/s 271(1)(c) - whether when substantial question of law has been framed and admitted, therefore, the issue has become debatable, therefore, penalty is not leviable? - Held that - The Hon ble jurisdictional High Court in CIT Vs Smt. Kaushalya (1995 (1) TMI 25 - BOMBAY High Court) while dealing with the similar ground about the limb of charge, whether mere mistake in language used or mere not striking off of inaccurate portion cannot by itself invalidate notice issued under section 274 of the Act. The language of the section does not speak about the issuance of notice. All that is required is that the assessee be given an opportunity of show cause. The issuance of notice is an administrative device for informing the assessee about the proposal of levy of penalty in order to enable him to explain why it should not be levied against him. If it is taken for the sake of argument that mere mistake in the language in the notice for non-striking off of inaccurate particular or marking on concealment of income portion cannot by itself invalidate the notice. Entire facts and backgrounds thereof are to be kept in mind. Every concealment of fact may ultimately result in filing of or furnishing inaccurate particular. It was further argued that no statutory notice has been prescribed in this behalf in the Income tax Act. The judgment of Hon ble Jurisdictional High Court in CIT Vs Kaushalya (supra) is still having a binding force on us. Thus, with utmost regards to the judgment of Karnataka High Court in CIT Vs Manjunatha Cotton & Ginning Factory (2013 (7) TMI 620 - KARNATAKA HIGH COURT ) we are bound to follow the judgment of jurisdictional High Court in CIT Vs Kaushalya (supra). - Decided against assessee. Penalty u/s 273 - assessee contended that no section was mentioned in the penalty order, therefore, the penalty has to be deleted - Held that - On perusal of the notice issued u/s 273 r.w.s 274, (page-35 of the paper book), it was fairly agreed by the ld. counsel for the assessee that section 273(2)(b) of the Act has been mentioned in the aforesaid notice. Since, we have deliberated upon the facts/case laws in detail, while deliberating/adjudicating the appeals of the assessee u/s 271(1)(c) of the Act in earlier paras of this order, therefore, considering the elaborate discussion made therein and the factual matrix available on record, on identical reasoning, we find that the assessee neither paid the advance tax nor filed the estimate of advance tax payable in terms of section 209A of the Act, the assessee failed to fulfill the statutory obligation. The original return was accepted u/s 143(1) of the Act and as a result, effectively, the subsequent assessment is the only assessment in the case of the assessee. Even bona-fide belief is not borne out of facts. Considering the totality of facts, we find no infirmity in the conclusion of the Ld. Commissioner of Income Tax (Appeal), thus, these appeals are also dismissed.
Issues Involved:
1. Imposition/confirmation of penalty under Section 271(1)(c) of the Income Tax Act, 1961. 2. Imposition/confirmation of penalty under Section 273 of the Income Tax Act, 1961. Issue-wise Detailed Analysis: 1. Imposition/confirmation of penalty under Section 271(1)(c) of the Income Tax Act, 1961: The assessee challenged the imposition of penalty under Section 271(1)(c) of the Act. The Tribunal had previously decided the quantum appeal against the assessee. The Assessing Officer made additions based on Section 68 of the Act, finance charges, and interest income. The assessee argued that the issue was debatable as a substantial question of law had been framed and admitted, citing various case laws to support that penalty should not be levied in such circumstances. The Department contended that the Tribunal's decision was pursuant to the jurisdictional High Court's direction, and thus, there was no admission of a substantial question of law. The Department emphasized that the assessee had disclosed stocks and units in its books but later changed its version to claim them as finance charges, without any proof of finance transactions. The Tribunal confirmed the additions, leading to the imposition of the penalty for concealing income and furnishing inaccurate particulars. The Tribunal analyzed the facts and concluded that the assessee indulged in transactions in securities through its bank account but failed to furnish necessary details or explain the source of credits, leading to the addition under Section 68. The Tribunal also noted that the assessee did not provide any confirmation for the interest payable to M/s Champaklal Devidas, which was thus disallowed and added to the income. The Tribunal rejected the assessee's argument that the issue was debatable due to the High Court's order, noting that the High Court had remitted the matter back to the Tribunal without examining the merits. The Tribunal emphasized that the assessee failed to discharge its onus under Section 68 of the Act and Section 106 of the Evidence Act. The Tribunal further discussed the provisions of Section 271(1)(c) of the Act, concluding that the assessee consciously concealed particulars of income or furnished inaccurate particulars. The Tribunal upheld the penalty, rejecting the assessee's technical objections regarding the notice of penalty proceedings. 2. Imposition/confirmation of penalty under Section 273 of the Income Tax Act, 1961: The assessee contended that no section was mentioned in the penalty order under Section 273, arguing that it was a debatable issue and that the loss had been accepted by the Tribunal. The Department clarified that Section 273(2)(b) was mentioned in the penalty notice, thus the claim of the assessee was factually incorrect. The Tribunal found that the assessee neither paid the advance tax nor filed the estimate of advance tax payable as required by Section 209A of the Act. The Tribunal noted that the original return was accepted under Section 143(1), and the subsequent assessment was the only effective assessment. The Tribunal found no bona fide belief borne out of facts and upheld the penalty under Section 273. Conclusion: The Tribunal dismissed all the appeals of the assessee, upholding the penalties imposed under Sections 271(1)(c) and 273 of the Income Tax Act, 1961. The Tribunal emphasized the assessee's failure to discharge the onus of explaining the credits and fulfilling statutory obligations, leading to the confirmation of penalties.
|
