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TMI Blog2014 (1) TMI 1073X X X X Extracts X X X X X X X X Extracts X X X X ..... n income of Rs. 4,74,031/- was filed on 31.3.2007. In the return of income the assessee had declared Short Term Capital Gains (STCGs) amounting to Rs. 3,01,482/- on redemption of mutual funds. On perusal of the details it was noticed that the gross STCGs earned by the assessee were Rs. 5,18,039/- from which amount of Short Terms Capital Loss (STCL) of Rs. 2,16,557/- had been reduced and the next taxable STCGs had been declared at Rs. 3,01,482/-. From the detailed working of the net STCGs, the Assessing Officer noticed that the assessee had not kept in mind the provisions of section 94(7) and had not ignored the loss arising on purchase and sale of mutual fund units to the extent of dividend received. In his letter dated 14.10.2008, the Asse ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... query submitted before the Assessing Officer that information required for calculation of disallowance u/s. 94(7) such as record dates were not available at the time of filing of return of income and it was not willful and conscious fault of the assessee. Further, the assessee had agreed to the addition made by the Assessing Officer for peace of mind and cooperation with the department and tax including interest was duly deposited. Further, the provisions of section 94(7) were not popular and were not in frequent use because of which the required information under section could not be incorporated in the return. After considering this explanation of the assessee, the Assessing Officer imposed a penalty u/s. 271(1)(c) amounting to Rs. 66,44 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e record dates were not available, the correct disallowance u/s. 94(7) could not be calculated. Please consider the above facts and oblige." 8. From the above, it is apparent that the Chartered Accountant Firm has failed to get the record dates and accordingly failed to calculate correct disallowance. Hence, it is apparent that the above addition in this regard arose neither because of concealment or furnishing of inaccurate particulars by the assessee, but due to mistake on the part of the assessee's counsel. 9. In this regard, we draw support from the Hon'ble Apex Court decision in the case of Price Waterhouse Coopers Pvt. Ltd. vs. C.I.T. and Anr. 348 ITR 306 (SC). In this case it was held, allowing the appeal, that the facts of the cas ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 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 clearly not the intendment of legislature. 11. Respectfully following the above precedent and the discussion hereinabove, we delete the penalty in this case. In the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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