2019 (2) TMI 521 - AT - Income Tax

Penalty u/s. 271(1)(c) - proof of concealment or furnishing of inaccurate particulars of income - Held that - All the particulars of assessee s claim were duly available before the A.O. There is no case of concealment or furnishing of inaccurate particulars of income. Just because the A.O. was not in agreement with the claim of the assessee, which cannot be said to be ex-facie bogus, penalty u/s. 271(1)(c) is not leviable. This proposition is duly supported by the Hon ble Apex Court decision in the case of Reliance Petroproducts Pvt. Ltd. 2010 (3) TMI 80 - SUPREME COURT . Accordingly, we set aside the orders of the authorities below and decide the issue in favour of the assessee.

Summary

Issues:
Levy of penalty u/s. 271(1)(c) of ? 5,10,369/- for assessment year 2010-11.

Detailed Analysis:

1. Issue of Concealment and Ignorance of Law:
The case involved the non-disclosure of details regarding the sale of land by the assessee in the return of income filed with the department. The assessee claimed the land was agricultural and exempt from taxation, but failed to provide credible documents to support this claim. The Assessing Officer (A.O.) determined the capital gain at a higher value than declared by the assessee and initiated penalty proceedings under section 271(1)(c) of the Income Tax Act. The assessee contended that the non-disclosure was due to ignorance of the law regarding the taxation of agricultural land. However, the A.O. imposed a penalty of ? 5,10,369/- despite the explanations provided by the assessee.

2. Claim of No Concealment:
The assessee argued that there was no concealment of income as all particulars of the claim were available before the A.O. The assessee maintained that there was no furnishing of inaccurate particulars and that the disagreement between the A.O. and the assessee did not amount to ex-facie bogus claim. The Appellate Tribunal referred to the decision of the Hon'ble Apex Court in the case of Reliance Petroproducts Pvt. Ltd. and concluded that penalty under section 271(1)(c) is not leviable solely based on a disagreement between the A.O. and the assessee, especially when there is no concealment or furnishing of inaccurate particulars.

3. Decision and Ruling:
Upon hearing both parties and perusing the records, the Appellate Tribunal set aside the orders of the authorities below and decided the issue in favor of the assessee. The Tribunal held that since there was no concealment or furnishing of inaccurate particulars, the penalty under section 271(1)(c) was not justified. The appeal by the assessee was allowed, and the penalty of ? 5,10,369/- was annulled.

This detailed analysis highlights the key legal arguments, the reasoning behind the decision, and the final ruling of the Appellate Tribunal in the case concerning the levy of penalty under section 271(1)(c) for the assessment year 2010-11.