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TMI Blog2012 (10) TMI 252X X X X Extracts X X X X X X X X Extracts X X X X ..... ribunal) in ITA No. 372(ASR)/2010, for the assessment year 2006-07, claiming the following substantial question of law:- "Whether on the facts and circumstances of the case, when the assessee has not discharged its onus that the wrong/inadmissible expenditure was a bonafide mistake with no intention of increasing its loss, the Hon'ble ITAT Bench was justified in law and on the facts in holding that mere making of claims, which is not sustainable in law, by itself, will not amount to furnishing inaccurate particulars regarding the income of the assessee?" 3. Briefly the facts necessary for adjudication of the present appeal as narrated therein are that the assessee filed its return on 31.10.2006 declaring loss of Rs. 93,31,795/-. The said ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of penalty by the CIT(A) as well as by the Tribunal was arbitrary and bad in law. 6. Examining the legal position, it may be noticed that the Hon'ble Supreme Court in Commissioner of Income Tax v. Reliance Petro Products (P) Ltd. (2010) 230 CTR 320 (SC) had held that mere making of a claim which was ultimately found to be unsustainable may not by itself amount to furnishing of inaccurate particulars regarding the income. The revenue was required to show that the deduction claimed was against the statutory provision. It was recorded as under:- "We have already seen the meaning of the word "particulars" in the earlier part of this judgment. Reading the words in conjunction, they must mean the details supplied in the return, which are not a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the provisions of section 36(viia) of the Act were not applicable to assessee's case as the primary cooperative agricultural development bank is explicitly excluded from claiming deduction on account of provisions for NPA. In the instant, the A.O. has categorically stated in the penalty order that the claim made by the assessee was wrong/ inadmissible. In the instant case, the learned CIT(A) correctly observed that it was a bonafide mistake leading to wrong claim of deduction. It is seen that the assessee has contended that the provisions for NPA was made as per RBI guidelines in respect of which it has become sub-standard/bad and doubtful. The NPA provision was checked and verified by the auditor before finalizing the balance sheet. It is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... because the assessee claimed deduction of interest expenditure which has not been accepted by the Revenue, penalty under s. 271 (1)(c) is not attracted; mere making of the claim, which is not sustainable in law, by itself, will not amount to furnishing inaccurate particulars regarding the income of the assessee." The assessee claimed deduction, which was not accepted by the Revenue, penalty under section 271(1) (c) of the Act is not attracted. In the case of Reliance Petroproducts (P) Ltd. (supra), the Hon'ble Supreme Court conclude that "A mere making of the claim, which is not sustainable in law, by itself, will not amount to furnishing inaccurate particulars regarding the income of the assessee". In our considered view, the ratio laid ..... X X X X Extracts X X X X X X X X Extracts X X X X
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