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TMI Blog2012 (10) TMI 844X X X X Extracts X X X X X X X X Extracts X X X X ..... his income, it could not be said that the at time when assessee filed return, he had failed to disclose fully and truly all material facts necessary for assessment. As decided in C.I.T., Ahmedabad Versus Reliance Petro Products Pvt. Ltd. [2010 (3) TMI 80 - SUPREME COURT] it was up to the authorities to accept its claim in the Return or not. Merely because the assessee had claimed the expenditure, which claim was not accepted or was not acceptable to the Revenue, that by itself would not attract the penalty u/s 271(1)(c) & if the contention of the Revenue is accepted then every Return where the claim made is not accepted by AO for any reason the assessee will invite penalty under Section 271(1)(c) - in favour of assessee. - I.T.A. No. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the assessee has furnished inaccurate particulars of income to the said extent and claimed excess deduction. 3.1 In response to the show cause notice of the Assessing Officer, the assessee filed its reply dated 18.2.2010 as under:- In terms of amendment, no deduction under section 80HHC could be claimed on DEPB if the turnover of the assessee exceeds Rs.10 crores. Since the assessee s case was covered by the amendment, the assessment has been reframed under section 148/143(3). Based on the above amendment and the changes brought under section 28, the income of the assessee was computed at Rs.9281790/-. Since the changes have come with retrospective effect, the assessee was not aware at that time that deduction under section 80HHC woul ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Ld. Commissioner of Income Tax (A) vide his order dated 10.12.2008. The Assessing Officer on these facts concluded that the assessee has willfully furnished inaccurate of income leading to the concealment of income by way of claiming excess deduction of Rs.29,33,941/- u/s. 80HHC. The Assessing Officer therefore, imposed penalty of Rs.11,29,567/- u/s. 271(1)(c) of the I.T. Act, 1961 on the said concealment of Rs.29,33,941/- @100% of tax sought to evaded. 4. Upon assessee s appeal Ld. Commissioner of Income Tax (A) held as under:- I have considered the facts of the case, written submissions of the Assessing Officer, the case law relied upon by the assessee and the amendment in section 80HHC as per Taxation Laws (second amendment) Act, 20 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s was not the view adopted by Chartered Accountants in certificates issued in Form No. 10CCAC under section 80HHC(4). It was in this context, that the amendments were made as stated above. Prior to the amendments the Chartered Accountants calculating the deduction u/s. 80HHC in the prescribed Form No. 10CCAC were taking loss at nil. At the time of when the return was filed by the assessee on 31.10.2000, the assessee made a bonafide deduction u/s. 80HHC, on the basis of the certificate issued by the Chartered Accountant in the prescribed Form No. 10CCAC, copy of which was only attached with the return of income. At the time when the return was filed all the material facts for computing the income was disclosed by the assessee. It is an a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... duction u/s. 80HHC, on the basis of certificate issued by the Chartered Accountant in the prescribed Form No. 10CCAC. Moreover, when assessee has disclosed all the material facts for computation of his income, it could not be said that the at time when assessee filed return, he had failed to disclose fully and truly all material facts necessary for assessment. Thus, we find here that the disallowance in this case has primarily arisen due to the fact that there was a retrospective amendment in the concerned act and assessee cannot be said to have foreseen the amendment. Under the circumstances, rigors of section 271(1)(c) are not attracted in this case. We find that section 271(1)(c) of the Act postulates imposition of penalty for furnishing ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pex Court decision in the case of CIT vs. Reliance Petro Products Ltd. in Civil Appeal No. 2463 of 2010. In this case vide order dated 17.3.2010 it has been held that the law laid down in the Dilip Sheroff case 291 ITR 519 (SC) as to the meaning of word concealment and inaccurate continues to be a good law because what was overruled in the Dharmender Textile case was only that part in Dilip Sheroff case where it was held that mensrea was a essential requirement of penalty u/s 271(1)(c). The Hon ble Apex Court also observed that if the contention of the revenue is accepted then in case of every return where the claim is not accepted by the Assessing Officer for any reason, the assessee will invite the penalty u/s 271(1)(c). This is clear ..... X X X X Extracts X X X X X X X X Extracts X X X X
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