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TMI Blog2016 (9) TMI 800X X X X Extracts X X X X X X X X Extracts X X X X ..... fide mistake, it might have been done, and the explanation of the assessee was not found to be false, therefore, allow the appeal assessee and delete the penalty. - Decided in favour of assessee. - ITA.No.242/Ahd/2016 - - - Dated:- 1-8-2016 - SHRI RAJPAL YADAV, JUDICIAL MEMBER For The Assessee : Shri Tej Shah, AR For The Revenue : Shri O.P. Meena, Sr.DR ORDER The assessee is in appeal before the Tribunal against the order of the ld.CIT(A)-1, Vadodara dated 16.12.2015 passed for the Asstt.Year 2008-09. 2. Solitary grievance of the assessee is that the ld.CIT(A) has erred in confirming the penalty of ₹ 3,47,727/- which was imposed by the ld.AO under section 271(1)(c) of the Income Tax Act, 1961. 3. Brief fa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 9,84,329/- is added back to assessee's total income. Penalty proceedings u/s 271(l)(c) of the I.T.Act, 1961, 1961 is also initialed for furnishing of inaccurate (Addition : ₹ 9,84,329/-) 6. On perusal of the submission it was found that the assessee has made payment to Natwarlal N Suthar, Vishwas Construction exceeding ₹ 20,000/- in a day or Gross 50,000/- for Repairs and Maintenance but he has not made TDS on these payments. In addition to this the Assessee has also made payment of ₹ 65,000/- to D Seven advertising for advertisement in Gujarat Samachar but not deducted TDS. The assessee was show caused why not these expenses should not be disallowed as either no proof has been furnished or no TDS has been ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... iculars. He has not imposed penalty for concealment of income. The AO has observed that the assessee has tried to evade tax by furnishing inaccurate particulars of income which lead to concealment of income. Thus, there is no confusion in the mind of the AO. I do not find any merit in the first fold of submission raised by the ld.counsel for the assessee. 6. In the next fold of submissions, it was contended by the ld.counsel for the assessee that the explanation given by the assessee was not found to be false. The assessee has been recognizing the income on cash basis, but keeping the expenditure on mercantile basis. It was a lapse under section 145(1) of the Income Tax Act. But there was no deliberate attempt at the end of the assessee ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , or (B) such person offers an explanation which he is not able to substantiate and fails to prove that such explanation is bona fide and that all the facts relating to the same and material to the computation of his total income have been disclosed by him, then, the amount added or disallowed in computing the total income or such person as a result thereof shall, for the purposes of Clause (c) of this subsection, be deemed to represent the income in respect of which particulars have been concealed. 8. A bare perusal of this section would reveal that for visiting any assessee with the penalty, the Assessing Officer or the Learned CIT(Appeals) during the course of any proceedings before them should be satisfied, that the assessee ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e to play if the assessee failed to give any explanation with respect to any fact material to the computation of total income or by action of the Assessing Officer or the Learned CIT(Appeals) by giving a categorical finding to the effect that explanation given by the assessee is false. In the second situation, the deeming fiction would come to play by the failure of the assessee to substantiate his explanation in respect of any fact material to the computation of total income and in addition to this the assessee is not able to prove that such explanation was given bona fide and all the facts relating to the same and material to the computation of the total income have been disclosed by the assessee. These two situations provided in Explan ..... X X X X Extracts X X X X X X X X Extracts X X X X
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