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TMI Blog2013 (12) TMI 361X X X X Extracts X X X X X X X X Extracts X X X X ..... ollections were not part of its income but were diverted by an overriding title towards charity, filed returns for the impugned Assessment Years excluding the Dharmada collections from its turnover - The assessee was not making a frivolous claim - There was not any filing of inaccurate particulars of income. Following Dharmandra Textile Processors [2008 (9) TMI 52 - SUPREME COURT] - Willful and deliberate suppression on the part of assessee was necessary for levy of penalty under section 271(1)(c) – Following Reliance Petro Products Pvt Ltd. [2010 (3) TMI 80 - SUPREME COURT] - A mere claim will not amount to furnishing inaccurate particulars regarding the income of the assessee - Decided against Revenue. - ITA No.1959 to 1964/Mds./201 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... urn it could not plead that the income was offered to purchase peace with Department and that there could be no estoppels or agreement against a statute as held in the case of S.Sivakuar Vs. ACIT (1998) 64 ITD 149 MAD. 1.e. The Ld. CIT(A) has failed to note that the provisions of section 271(1)(c) are clearly applicable in this case and that the A.O. has no discretion not to levy penalty under section 271(1)(c) as per the ratio of the judgement in the case of CIT Delhi Vs. Atul Mohan Bindal (2009) 317 ITR 1 (SC). 2. Short facts apropos are that there was a search done in the premises of the partners of the assessee firm on 21.10.08. There was a simultaneous survey in the premises of the assessee-firm also. Pursuant to search notices ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... works to various distributors. In the invoice raised by the assessee on its distributors, it was separately showing about 1.3% of the sale value as Mahumai and collecting such amounts from its distributors. Assessing Officer in the course of assessment proceedings after the search, was of the opinion that such Mahumai amount should be considered only as part of the turnover of assessee and had to be taxed. Though assessee relied on the decision of Hon ble Apex Court in the case of CIT Vs. Bijli Cotton Mills (P) Ltd. (1979) 116 ITR 60 (SC) arguing that there was an overriding title created in favour of charity on the Mahumai amount collected by it, thereby taking such amounts out of the purview of its income, this was not acceptable to the A ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... its income in the assessment for A.Y. 2001-02, and on its appeal, CIT(A) had held such amounts to be not part of its income. Assessee also filed a statement reconciling the difference between income returned as per original returns and income shown in the revised returns for each of the years, to show that such differences were only on account of inclusion of Mahumai receipts. 6. CIT(A) was appreciative of these contentions. According to him, in view of the decision of Hon ble Apex Court in the case of CIT Vs. Reliance Petroproducts, [2010] 322 ITR 158 (SC), even if revised returns were filed after search, if it was done for purchasing peace and avoiding litigation, and if the assessment simply rested on the act of such voluntary surrende ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ct enable it to circumvent the provisions for giving relief to donors of charity under section 80G of the Act. Relying on the decision of Hon ble jurisdictional High Court in the case of CIT Vs. Madras Race Club in 255 ITR 98, Ld. D.R. submitted that where the amounts were not paid with the intention of making a contribution to a charitable or benevolent fund, assessee could not take refuge under the decision of Hon ble Apex Court in the case of Bijli Cotton Mills(supra) and argue that collections of Dharmada could not be taxed. Relying on the decision of Hon ble Karnataka High Court in the case of CIT Vs. Sangmeshwara Associates [2012] 345 ITR 396 and that of Madras High Court in the case of CIT Vs. C. Ananthan Chettiar 273 ITR 401, Ld. De ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cision of Hon ble Apex Court in the case of Bijli Cotton Mills (Supra) applied on all four squares. Taking this view, CIT(A) had deleted the additions done in a regular assessment for A.Y.2001-02. Search in the impugned cases leading to the assessment and levy of penalties happened only on 21.10.08, whereas above mentioned appellate order of A.Y.2001-02 was passed on 22.09.04. Admittedly, Revenue had not moved in appeal against the order of CIT(A) for A.Y. 2001-02. Hence, assessee had all reasons to carry a bona fide relief that Dharmada collections were not part of its income but were diverted by an overriding title towards charity. On such belief, if the assessee had filed returns for the impugned Assessment Years excluding the Dharmada c ..... X X X X Extracts X X X X X X X X Extracts X X X X
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