2018 (3) TMI 384 - HC - Income Tax

Penalty u/s 271(1)(c) levied on income declared in the revised return of income filed u/s. 139(5) - Tribunal deleted the penalty - Held that - Revised return of income u/s 139(5) was filed by the Assessee on its own and not on account of any detection of inaccurate particulars of income being filed by the Respondent in its original return of income. The finding of fact rendered both by the CIT(A) and the Tribunal that the revised return of income was filed by the Respondent suo motu and not consequent to detection of inaccurate particulars of income by the Assessing Officer, is not shown to be perverse. Admittedly, there is no allegation that the revised return of income filed by the Assessee, contains any inaccurate particulars of income. No substantial question of law. - Decided in favour of assessee.

Summary

Issues:
Challenge to order of Income Tax Appellate Tribunal regarding penalty under Sections 271(1)(c) on income declared in revised return of income filed under Section 139(5) of the Income Tax Act, 1961 for Assessment Year 2005-06.

Analysis:

Issue 1: Challenge to Tribunal's Decision on Penalty under Sections 271(1)(c)
The appellant challenged the Income Tax Appellate Tribunal's decision regarding the penalty under Sections 271(1)(c) on the income declared in the revised return of income filed under Section 139(5) for Assessment Year 2005-06. The key question raised was whether the Tribunal was correct in holding that the penalty cannot be levied on income declared in the revised return. The Respondent initially filed a return declaring a loss, but after receiving a scrutiny notice, filed a revised return showing a reduced income. The Assessing Officer initiated penalty proceedings, alleging that the revised return was not filed voluntarily but only after the scrutiny notice. The Commissioner of Income Tax (Appeals) deleted the penalty, emphasizing that the revised return was voluntarily filed by the Respondent and not due to detection by the Revenue. The Tribunal, in its order, reiterated this finding, stating that the revised return was validly filed by the Respondent on its own accord and not due to any investigation by the department. The appellant argued that the revised return was filed after the scrutiny notice, justifying the penalty. However, both the CIT(A) and the Tribunal found that the revised return was filed voluntarily by the Respondent and not due to any detection of inaccurate particulars in the original return. As there was no allegation of inaccurate particulars in the revised return, the question raised did not give rise to any substantial question of law. Therefore, the appeal was dismissed.

This detailed analysis of the judgment provides a comprehensive understanding of the issues involved and the decision rendered by the Bombay High Court regarding the penalty under Sections 271(1)(c) on the income declared in the revised return of income for Assessment Year 2005-06.