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TMI Blog2013 (7) TMI 616X X X X Extracts X X X X X X X X Extracts X X X X ..... file the appeal against the assessment order, it cannot be presumed that there was any concealment of income or furnishing of wrong particular - Even on merits, the assessee had a good case and had he filed the appeal against the original assessment order, the assessee's claim would have been allowed. As per the judgment in the case of CIT Vs. Delhi Press Patra Prakashan Ltd. - [2013 (6) TMI 70 - DELHI HIGH COURT], wherein it was considered that the employees of the sister concern who were engaged for executing the business of the assessee company was considered as the employees who were engaged for the purpose of manufacturing so as to entitle the assessee to claim the deduction under Section 80I - In the instant case, deduction under ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... A claimed by the assessee was disallowed. The order of the Assessing Officer was accepted by the assessee and no appeal was filed. That the Assessing Officer also levied the penalty under Section 271(1)(c) amounting to Rs. 39,20,736/- which was 200% of the tax sought to be evaded. On appeal, learned CIT(A) cancelled the penalty. Hence, this appeal by the Revenue. 4. At the time of hearing before us, it was stated by the learned DR that the assessee has not fulfilled the conditions for eligibility of deduction under Section 80IA and, therefore, patently, the claim made by the assessee for claiming the deduction was a wrong claim which is also evident from the fact that the assessment order was accepted by the assessee. He, therefore, submi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... der Section 80I. That in the case of the assessee, all the particulars were duly furnished. It is not the case of the Revenue that any fact was either concealed or wrong fact was stated. That the claim of the assessee for deduction under Section 80I can at the most be a wrong claim but, it cannot be said to be a false claim. That whether the labourers engaged in the manufacturing process on job work basis are to be considered for counting the number of labourers for the purpose of Section 80IA is a debatable issue and would involve the interpretation of the provision. That merely because the Assessing Officer has taken a different view than the view of the assessee, it cannot be said that the assessee furnished any inaccurate particulars or ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... w would not amount to giving inaccurate particulars of the income of the assessee, but it cannot be disputed that the claim made by the assessee needs to be bona fide. If the claim besides being incorrect in law is mala fide, Explanation 1 to section 271(1)(c) would come into play and work to the disadvantage of the assessee. The court cannot overlook the fact that only a small percentage of the income-tax returns are picked up for scrutiny. If the assessee makes a claim which is not only incorrect in law but is also wholly without any basis and the explanation furnished by him for making such a claim is not found to be bona fide, it would be difficult to say that he would still not be liable to penalty under section 271(1)(c) of the Act. I ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... counts are compulsorily subjected to audit. In the absence of any details from the assessee, we fail to appreciate how such deductions could have been left out while computing the income of the assessee-company and how it could also have escaped the attention of the auditors of the company." 7. Thus, after considering the decision in the case of Reliance Petroproducts Pvt.Ltd. (supra), it was stated by the Hon'ble Jurisdictional High Court that mere submitting a claim which is incorrect in law would not amount to giving inaccurate particulars of the income of the assessee but if the claim, besides being incorrect in law is mala fide, Explanation 1 to Section 271(1)(c) would come into play. If the assessee's claim is bona fide, then he wil ..... X X X X Extracts X X X X X X X X Extracts X X X X
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