2022 (5) TMI 607 - AT - Income Tax

Penalty levied u/s 271(1)(c) - reopening of assessment u/s 147 - concealment and/or furnishing of inaccurate particulars of income in respect of additions made on account of confirming the total income without allowing any deduction on account of income already assessed and added in the immediately preceding year viz., Asst. Year 2007-08 - HELD THAT - This penalty has been confirmed by the Ld. CIT(A) also as the assessee has not filed regular return of income under Section 139(1) of the Act, but after issuance of 148 and other statutory notices. Therefore, the confirmation of penalty is correct in law, which does not require any interference and pleaded to dismiss the appeal filed by the assessee. We do not find any merits in the ground raised by the assessee namely without allowing any deduction on account of income already assessed in the A.Y. 2007-08. Both the Ld. Assessing Officer and the Ld. CIT(A) has levied and confirmed the penalty only on the addition of Rs. 6,14,178/-. Therefore, the ground raised by the assessee is rejected and the appeal of assessee is dismissed.

Issues involved:
- Appeal against penalty under Section 271(1)(c) of the Income Tax Act, 1961 for A.Y. 2008-09.
- Concealment of income and furnishing inaccurate particulars of income.
- Assessment based on revised Profit & Loss Account and Balance Sheet.
- Penalty levied by Assessing Officer and confirmed by Ld. CIT(A).
- Grounds of appeal challenging the penalty confirmation.
- Failure to allow deduction for income already assessed in the preceding year.
- Confirmation of penalty by Appellate Tribunal.

Analysis:
1. The case involves an appeal against a penalty levied under Section 271(1)(c) of the Income Tax Act, 1961 for the Assessment Year 2008-09. The appellant, an individual engaged in contract business, failed to file the return of income for the said year initially. However, after receiving a notice under Section 148, the appellant filed the return, and the assessment was completed based on revised financial statements, resulting in a total income of Rs. 13,25,098. The Assessing Officer initiated penalty proceedings for concealing income and furnishing inaccurate particulars.

2. The Assessing Officer held that the appellant's failure to voluntarily file the return for A.Y. 2008-09, and the subsequent declaration of income only after notices were issued, amounted to concealment of income. Consequently, a penalty of Rs. 1,87,938 was imposed. The Ld. CIT(A) affirmed the penalty, stating that the appellant's actions constituted concealment as the return was filed in response to a notice under Section 148, not voluntarily. The penalty was confirmed under Explanation 1 to Section 271(1)(c) of the Act.

3. The appellant challenged the penalty confirmation, arguing that no deduction was allowed for income already assessed in the previous year (A.Y. 2007-08). However, both the Assessing Officer and the Ld. CIT(A) imposed and confirmed the penalty only on the additional income of Rs. 6,14,178, not the total income of Rs. 13,25,098. The Appellate Tribunal rejected the appellant's ground, stating that the penalty was correctly imposed and confirmed based on the specific addition to income.

4. Ultimately, the Appellate Tribunal dismissed the appeal, upholding the penalty levied under Section 271(1)(c) of the Income Tax Act, 1961. The Tribunal found no merit in the appellant's argument regarding the deduction for income assessed in the preceding year and affirmed the decision of the lower authorities regarding the penalty imposition.

This detailed analysis highlights the sequence of events leading to the penalty imposition, the rationale behind the decision of each authority, and the final judgment of the Appellate Tribunal confirming the penalty under Section 271(1)(c) for the Assessment Year 2008-09.

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