2014 (11) TMI 519 - HC - Income Tax

Imposition of penalty u/s 271(1)(c) Particulars of income concealed and inaccurate particulars furnished or not Held that - The penalty has been imposed after the requisite satisfaction is recorded the Tribunal had rightly held that the Assessee indulged in an act which could be termed as deliberate - She presented not only a wrong, incorrect but a non-genuine claim of gift - She was aware that it was untenable and even wrong and incorrect - The reasons assigned by the Tribunal do not indicate that it was unaware of the distinction in clause (c) of sub-section 1 of section 271 of the Income Tax Act, 1961 - the Assessee presented incorrect and untrue facts regarding the amount received claiming it as gift and which was found as not genuine as such no substantial question of law arise for consideration Decided against assessee.

Summary

Issues:
Challenge to imposition of penalty under section 271(1)(c) of the Income Tax Act, 1961 based on concealment of income or furnishing inaccurate particulars.

Analysis:
The judgment by the High Court of Bombay pertains to an appeal filed by the Assessee against the order of the Income Tax Appellate Tribunal upholding the imposition of penalty under section 271(1)(c) of the Income Tax Act, 1961. The Appellant argued that the Tribunal erred in law by not distinguishing whether the penalty was imposed for concealing income or furnishing inaccurate particulars. The Court noted that the penalty was imposed after the necessary satisfaction was recorded, as evidenced by the factual materials in a previous appeal by the same Appellant challenging quantum proceedings. The Tribunal found that the Assessee deliberately presented incorrect and non-genuine claims of gift, indicating awareness of the incorrectness of the claim. The Court concluded that the Tribunal was not unaware of the distinction in clause (c) of section 271(1) and that the Appeal did not raise any substantial question of law.

The Court referred to a judgment of the Hon'ble Supreme Court in a case under the Tamil Nadu General Sales Tax Act, where it was held that if items not included in the turnover were disclosed in the dealer's account books and unilaterally included by the Assessing Authority, penalty for concealment was not justified. The Supreme Court emphasized that complete disclosure without concealment or furnishing inaccurate particulars would warrant setting aside of the penalty. The Court in the present case found no general rule established by the Supreme Court's judgment that could assist the Appellant. Consequently, the Court dismissed the Appeal, stating that there was no merit in it and made no order as to costs.