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TMI Blog2013 (8) TMI 551X X X X Extracts X X X X X X X X Extracts X X X X ..... the return o income for the current year, and not by actually claiming a set off. The same makes his stand, rather than clarificatory, contradictory, inasmuch as the assessee did not withdraw its claim for the preceding year. In fact, the return for the current year stands filed on 22/4/2004, i.e., after having received the order allowing its claim for set off of business loss against income (LTCG) for AY 1995-96, so that these considerations are only hypothetical and of no relevance. This is as the loss no longer survived for set off, having been already adjusted, rendering the claim for its adjustment (of business loss) to that extent (for this year) as without basis. The assessee thus has no explanation, much less a valid one, for the excess of Rs. 27.01 lakhs, except want of due diligence. In fact, the audit report contains a specific column for furnishing information on brought forward claims for losses and unabsorbed depreciation, and which should have also infused a sense of responsibility in preparing and filing the return, while it is apparent that the figure of loss(es) has been mechanically adopted. Rather, as apparent, the record was not updated for three conse ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 01-02 3,09,87,155 3,09,87,155 - 2002-03 99,59,783 95,29,165 4,30,618 2003-04 51,35,505 51,35,505 - Total 6,03,41,245 5,69,10,179 34,41,066/- 2.2 It is this difference of Rs. 34.31 lacs, which is subject matter of penalty. Without doubt, and undisputedly, the adjustment of the brought forward business losses has been allowed in assessment (for the current year) at the correct amount/s, i.e., at which the claim of (business) loss was exigible in terms of assessment order/s for the relevant years. The difference, however, has a genesis to it, which would be relevant to be set out as it forms the background under which the claim/s stands made, forming the substance of the assessee s explanation. The same is tabulated below: Assessment Year Nature of Loss/Allowance As per return of income As per assessment record 1995-96 Business Loss Less: LTCG Set-off allowed under Order Less: Set-off in A.Y. 2000-01 86,14,555 - 86,14,555 27,00,449 86,14,555 86,14,555 59,14,106 59,14,106 1996- ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... decision in the case of CIT v. P.K. Narayana 238 ITR 905 (Ker) would be to no avail. Mens rea or willful neglect is no longer an essential ingredient for the levy of penalty, as clarified by the apex court in the case of Union of India and Anr. v. Dharmendra Textile Processors and Ors. (2008) 306 ITR 277 (SC). Reliance stands also placed on the decisions in the case of B.A. Balasubramaniam and Bros v. CIT (1999) 236 ITR 977 (SC); CIT v. Sree Valliappa Textiles (2007) 294 ITR 322 (Kar); and CIT v. Shree Krishna Trading Company, 253 ITR 645 (Ker). 5. We have heard the parties, and perused the material on record, as well as the case law cited. 5.1 We would firstly like to reiterate that the law of the matter is well settled. It is only at the assessee s door that the onus to furnish a reasonable explanation for the concealment or for furnishing inaccurate particulars of income lies. The levy is a civil and a strict liability, and the assessee has to explain its claim as made per the return of income filed on the basis of a plausible explanation, duly substantiated, failing which Explanation 1 to section 271(1)(c) would stand attracted, and he deemed to have concealed or furnished ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s figure, as against the correct figure of Rs. 46,42,549/-, that it sought to carry forward from year to year, leading to an excess claim of Rs. 3 lakhs. The bona fides of the claim, i.e., as being a result of a genuine error gets established on the strength of the nature of the omission, i.e., adoption of figure 9 instead of 6 and, further, of it having been assumed for over three years prior to the actual impugned set off, i.e., against income for A.Y. 2004-05. The plea merits acceptance, and is accordingly so. As regards the balance amount of Rs. 27,00,448/-, it is clear that assessee did not revise the statement of brought forward (or carry forward) loss/es even after the receipt of the appellate order for A.Y. 1995-96 on 25.01.2002, accepting its claim for the set-off of loss to this extent. The same led to a corresponding difference in the brought forward loss for A.Y. 1996-97. To this extent the assessee has clearly preferred a double claim, i.e., firstly against the income for AY 1995-96 and then again for the current year. Its argument of the A.O. having disallowed the claim subject to verification is to no effect inasmuch as the difference in loss, as claimed and ..... X X X X Extracts X X X X X X X X Extracts X X X X
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