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TMI Blog2013 (12) TMI 895X X X X Extracts X X X X X X X X Extracts X X X X ..... akara Rao And Amit Shukla, JJ. For the Appellant : None For the Respondent : Mrs Jothilakshmi Nayak ORDER:- PER : Amit Shuka The present appeal has been preferred by the Revenue, challenging the impugned order dated 20th October 2010, passed by the learned Commissioner (Appeals)-II, Mumbai. The sole ground raised by the Revenue is that, the learned Commissioner (Appeals) has erred in law and on facts in deleting the penalty of Rs. 3,84,000, levied under section 271(1)(c) by the Assessing Officer. 2. None appeared on behalf of the respondent assessee. We, however, proceed to dispose off the Revenue's appeal on merits after hearing the learned Departmental Representative. 3. Facts in brief:- The assessee company is enga ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as business income. After detailed discussion, he taxed the rental income as income from house property. Such an order was the subject matter of the first appeal wherein this issue was decided against the assessee, however, no further appeal was filed against the said order. 4. During the course of penalty proceedings, the assessee submitted that it was under a bonafide belief that rental income from an exploitation of business on asset has to be treated as business income and in any case showing the income under different head was an honest and bonafide mistake. Reliance was also placed on various decisions on this score which has been noted by the Assessing Officer in the penalty order. However, the assessee's explanation has been rejec ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... penalty. On the date when return of income was filed by the assessee, there were clearly two views in existence as far as the legal situation is considered. In such a situation assessee claiming a particular line will definitely amount to a bonafide claim and therefore in such situations imposition of penalty is not justified. The penalty imposed is therefore cancelled." 6. Before us, the learned Departmental Representative strongly relied upon the original findings of the assessment order and submitted that the assessee has tried to show the "income from house property" under the head "business income", solely for the purpose of claiming expenditure. Such a change of head was not a bonafide mistake but done purposely to reduce taxable in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that such on belief or explanation is false or not bonafide, then its explanation has to be accepted at least in the penalty proceedings. There cannot be a question of furnishing of inaccurate particulars of income when all the details have been furnished at the time of filing of return of income. The only issue is under which head it should be assessed. The assessability of an income under a particular head depends upon various facts and circumstances and at times there are very thin line demarcation on which it can be adjudged about the nature of income and its classification. This has to be clearly brought out on the basis of material and evidence on record. Once that has not been done, then clearly it becomes a very debatable issue and ..... X X X X Extracts X X X X X X X X Extracts X X X X
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