2019 (1) TMI 543 - HC - Income Tax

Penalty levied u/s 271(1)(c) - assessee filed the revised return of income only after the survey action u/s 133A taken place in the premises of the purchaser - treat the revised return as return filed in response to the notice under Section 148 - Held that - Tribunal was of the view that it was not a case where penalty could be levied under Section 271(1)(c) of the Act because the entire addition resulted from the voluntary disclosure by the assessee, though omitted to be disclosed while filing the original return of income due to bona fide reasons. In our considered view, the CIT(A) as well as the Tribunal considered the factual position and were satisfied that the contentions advanced by the assessee were bona fide. Thus, we find that no substantial question of law arises for consideration in these appeals. - decided against revenue

Summary

Issues:
- Appeal against the order dated 17.4.2014 in ITA No.1618/Mds/2013 and C.O.No.152/ Mds/2013 on the file of the Income Tax Appellate Tribunal Madras 'D' Bench for the assessment year 2008-09.
- Whether penalty under Section 271(1)(c) was correctly deleted by the Appellate Tribunal.
- Whether the assessee concealed income or furnished inaccurate particulars in the original return.
- Whether the belated return filed after a survey can be considered as voluntary disclosure for penalty levy under Section 271(1)(c).

Analysis:
The Revenue filed appeals challenging the order of the Appellate Tribunal regarding the penalty under Section 271(1)(c) for the assessment year 2008-09. The substantial questions of law raised included the timing of the revised return filed after a survey action, the alleged concealment of income, and the voluntary nature of the belated return. The Commissioner of Income Tax (Appeals) found that the assessee's actions were not lacking bona fide, as taxes were paid before receiving the notice under Section 148 of the Act. The CIT(A) concluded that the revised return, filed before the notice under Section 148, was a voluntary disclosure of income and directed the deletion of the penalty.

The Tribunal upheld the CIT(A)'s decision, noting that the entire addition to income resulted from the voluntary disclosure by the assessee, despite not being disclosed in the original return due to bona fide reasons. The Tribunal observed that the Assessing Officer treated the revised return as filed in response to the notice under Section 148 and accepted the income declared in it. Both the CIT(A) and the Tribunal found the assessee's contentions to be bona fide, leading to the dismissal of the Revenue's appeal. It was determined that no substantial question of law arose in the case, and the tax case appeals were accordingly dismissed, along with the connected CMP.