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TMI Blog2016 (6) TMI 563X X X X Extracts X X X X X X X X Extracts X X X X ..... ICE AKIL KURESHI) 1. Revenue is in appeal against the judgement of the Income Tax Appellate Tribunal dated 08.05.2015 raising following question for our consideration: "[A] Whether in law and on facts and in the circumstances of the case, the ITAT was justified in deleting the penalty levied u/s. 271(1)(c) of the Act even though the assessee had credited the profit on sale of shares claimed to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed the same to the capital reserve account in the balance sheet. According to the Assessing Officer, thus, the assessee had reduced the book profit. This was relevant because the case of the assessee fell under Section 115JB of the Income Tax Act, 1961. 3. The Assessing Officer made quantum additions which have been upheld by CIT (Appeals) and the Tribunal. Further appeal by the assessee being Ta ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssessee. 7.19 Be that as it may, even assuming that deeming fiction under Explanation 1 to Section 271(1)(c) can be triggered by a wrong legal claim, it cannot be the case that merely because there is a wrong claim, even if that be so, penalty under Section 27(1)(c) can be imposed. This deeming fiction under section 271(1)(c) only shifts the onus of proof on the assessee, as this Explanation itse ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... relied upon the decision of Supreme Court in case of CIT vs. Reliance Petroproducts Pvt. Ltd. reported in [2010] 322 ITR 158 (SC) and observed as under: "15. We find that the Assessing Officer was not justified in holding that the inaccurate particulars of income relating to capital gain was furnished by the assessee. No inaccuracy in any of the particulars in respect of capital gain earned by th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... receipt in question. Regarding the tax liability of such receipt, there was a difference of opinion between the assessee and Assessing Officer. That by itself would not give rise to penalty proceedings. We are not concerned with the quantum addition. We are only concerned whether the facts give rise to applicability of Section 271(1)(c) of the Act. Reference can be made to the decision of Supreme ..... X X X X Extracts X X X X X X X X Extracts X X X X
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