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TMI Blog2015 (6) TMI 642X X X X Extracts X X X X X X X X Extracts X X X X ..... the return or converting the loss declared in the return into income. The assessee has not declared loss in the return. Therefore, in our opinion, explanation 4(a) on the basis of which, the penalty has been imposed and confirmed by the CIT(A), will not apply. We, therefore, set aside the order of the CIT(A) and delete the penalty imposed by the AO under section 271(1)(c). - Decided in favour of assessee. - I.T.A. No.85/Kol/2013 - - - Dated:- 10-6-2015 - Shri P.K.Bansal Shri Mahavir Singh, JJ. For the Petitioner: Shri Miraj D. Shah, FCA For the Respondent : Shri Kanhiya Lal Kanak, Sr.DR ORDER Per Shri P.K.Bansal, A.M. This appeal has been filed by the assessee against the order of the CIT(A)-XX, Kolkata dated 05 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ance Rs. 3,37,700/- u/s. 14A Rs. 36,950/- Rs.12,69,41,255/- Less: Business Loss set-off- 1) A.Y. 2003-04 ₹ 6,48,15,260/- 2) A.Y. 2004-05 ₹ 5,85,25,995/- Rs.12,69,41,255/- NIL Balance business loss for A.Y. 2004-05 other A.Yrs carried forward as per Act. Income from other sources ₹ 4,69,99,816/- Gross Total Income Rs. 4,69,99,816/- L ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... audited profit loss a/c. and therefore, a bona fide mistake has been committed by the assessee but that bona fide mistake does not envisage the penalty as there was proper disclosure about the particulars of the income as well as particulars of each of the provisions made by the assessee. There was no intention of the assessee to conceal the particulars of its income or furnishing inaccurate particulars of income. The AO has applied the provision of Explanation 4(a) to section 271(1)(c). This explanation is applicable when the amount of the income has the effect of reducing the loss declared in the return or converting the loss into income. In the case of the assessee, neither net loss declared in the return was reduced nor the loss has b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... appellate authorities. Claiming those provisions as deduction under the Income Tax Act, it shall prove that the assessee has concealed the particulars of income or furnished the inaccurate particulars of income. Therefore, we do not agree with the ld. A.R. that the assessee has not concealed the particulars of income or furnished the inaccurate particulars of the income. It is not a case where the assessee has claimed an expenditure which may or may not be allowable under the Income-Tax Act as is in the case of claim of interest by the assessee in the case of Reliance Petro Products Pvt. Ltd. (supra), the decision as relied on by the assessee, in our opinion, will not assist the assessee. The assessee in this case has claimed the deduction ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d before the issue of notice under section 148); (c) in any other case, means the difference between the tax on the total income assessed and the tax that would have been chargeable had such total income been reduced by the amount of income in respect of which particulars have been concealed or inaccurate particulars have been furnished. 4.2 The AO, we noted in the instant case, has levied the penalty by applying Explanation 4(a). From the reading of Explanation 4(a), it is apparent that this clause defines the amount of tax to be evaded. The tax that would have been chargeable on the income in respect of which particulars have been concealed or the inaccurate particulars have been furnished, had such income been the total incom ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Ltd. 304 ITR 308. In this case, we noted that question involved was:- (Whether on the facts and circumstances of the case, the Appellate Tribunal was right in law in holding that the penalty under section 17(1)(c) of the Income Tax Act, 1961 cannot be levied, if the returned income is a loss in the cases prior to the amendment in the year 2002) 4.3 On this question, the Hon ble Supreme Court took the view that explanation 4 to section 271(1)(c)(iii) of the Income Tax Act, 1961 regarding the imposition of penalty, even if the returned income is a loss, is clarificatory and not substantive. It applies even to the assessment years prior to April 2003, the date on which it was brought into force. The facts involved in this case were tha ..... X X X X Extracts X X X X X X X X Extracts X X X X
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