2020 (10) TMI 624 - HC - Income Tax

Penalty u/s 271(1)(c) - set off the losses incurred in the share trading business from that of the professional income disallowed - whether making of a claim of set off losses suffers in share trading would amount to furnishing inaccurate particulars of income? - Tribunal found in the assessee's case that the assessee has furnished entire transaction details before the AO - HELD THAT - Tribunal has recorded a finding of fact that it was never the case of revenue that the assessee has concealed any part of his income and also noted the argument of the Department before the Tribunal that claiming a set off in respect of losses would amount to furnishing of inaccurate particulars of income. This argument was considered for its correctness and the Tribunal followed the decision of Reliance Petroproducts Pvt., Ltd. 2010 (3) TMI 80 - SUPREME COURT and held that after furnishing the details and making a claim in the return of income, does not amount to furnishing inaccurate particulars or concealed any part of income. Tribunal, held that the assessee had made a claim after furnishing entire details and it is his personal opinion with regard to the computation of income tax and there may be difference of opinion with regard to nature of transaction by the assessee on the one end and the opinion of the department on the other end and such difference of opinion, cannot be construed as furnishing inaccurate particulars of income. It is not clear as to when the assessments were taken up for consideration and whether they were simultaneously taken up; and in any event, as always argued by the revenue before us, each assessment year is distinct and different and we find that this cannot be a ground to upset the factual finding recorded by the Tribunal. - Decided against revenue.

Summary

Issues:
1. Challenge to the order passed by the Income Tax Appellate Tribunal under Section 260A of the Income Tax Act, 1961.
2. Substantial questions of law raised by the Revenue regarding penalty levied under Section 271(1)(c) of the Act.

Analysis:
1. The Revenue challenged the order of the Income Tax Appellate Tribunal regarding penalty levied under Section 271(1)(c) of the Income Tax Act, 1961. The issue revolved around whether the Tribunal was correct in deleting the penalty imposed on the assessee. The Tribunal considered the assessee's claim for set off of losses incurred in share trading against professional income. The assessing officer initiated penalty proceedings under Section 271(1)(c) on the grounds of concealing income and furnishing inaccurate particulars. The assessee contended that the losses were due to speculative trading and were eligible for set off. The Commissioner of Income Tax Appeals upheld the penalty, alleging deliberate non-disclosure by the assessee. However, the Tribunal found that the assessee had provided all transaction details and that claiming set off did not amount to furnishing inaccurate particulars.

2. The Tribunal analyzed the provisions of Section 271(1)(c) of the Act and referred to the decision in C.I.T., Ahmedabad V. Reliance Petroproducts Pvt., Ltd. The Tribunal concluded that the assessee had disclosed all details and made a legitimate claim for set off, which did not constitute furnishing inaccurate particulars. The Tribunal emphasized that a mere difference in opinion between the assessee and the department regarding the nature of transactions did not imply deliberate concealment. The Tribunal dismissed the Revenue's appeal, stating that no substantial question of law arose from the case. The Tribunal's decision was based on the factual findings and legal principles established in previous judgments.

3. The Revenue argued that the assessee's repeated claims for set off over two assessment years indicated deliberate intention. However, the Court found no grounds to overturn the Tribunal's factual findings. The Court emphasized the distinct nature of each assessment year and upheld the Tribunal's decision to dismiss the appeals. Ultimately, the Court concluded that no substantial question of law was raised in the case, leading to the dismissal of the appeals without costs.