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TMI Blog2016 (11) TMI 795X X X X Extracts X X X X X X X X Extracts X X X X ..... the penalty under section 271(1)(c) of the Act imposed by the Assessing Officer vide order dated August 30, 2006 is also quashed and set aside. - Decided in favour of assessee - Special Civil Application No. 9315 of 2008 - - - Dated:- 15-7-2016 - K. S. Jhaveri And G. R. Udhwani, JJ. For the Petitioner : Manish J. Shah, Advocate For the Respondent : Sudhir M. Mehta, Senior Standing Counsel JUDGMENT K. S. Jhaveri, J. 1. By way of this petition under article 226 of the Constitution of India, the petitioner has challenged the order passed under section 264 of the Income-tax Act, 1961, on February 25, 2008 at annexure-H to the petition by the Commissioner of Income-tax, Surat, whereby the revision preferred by the petitioner was dismissed. 2. The facts of the case are that the assessee filed return of income for the assessment year 1996-97 on August 12, 1996, disclosing total income at ₹ 42,020. In the profit and loss account filed along with the return of income, the petitioner had shown labour charges to be paid at ₹ 15,19,030. The Assessing Officer made regular assessment under section 143(3) of the Act on March 31, 1997 determining total in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... culars of income and therefore the penalty order is bad in law. He has relied on the decision of this court in the case of Navnitlal K. Zaveri v. CIT reported in [1980] 125 ITR 385 (Guj), particularly at page 388, relevant portion which is reproduced below : It must be pointed out that time and again the Supreme Court and High Courts have pointed out that if the variation between the returned income and the assessed income arises by virtue of additions to the income made either because of disallowance or because of deemed income added or because of the estimate of the income made by the Income-tax Officer, then penalty is not leviable. 3.1 He has further relied on the decision of the Delhi High Court in the case of Devsons P. Ltd. v. CIT reported in [2010] 329 ITR 483 (Delhi) where in paragraph No. 27, it is observed as under (page 500) : Another contention of the learned counsel for the Revenue is that this issue whether the sundry creditors are genuine or not could not have been re-examined by a co-ordinate Bench of the Tribunal in penalty proceedings to arrive at a contrary conclusion by relying upon the assessment order of 1998-99 passed under section 143(3) of t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... el for the petitioner on the decision of the apex court in the case of Tripal Singh v. CIT reported in [2014] 365 ITR 511 (SC) wherein it is held as follows (headnote) : Held, that the assessees, who were not very educated persons, unfortunately could not be properly represented before the Assessing Officer and, therefore, the assessment was made for the assessment years 1998-99. The assessment for the assessment year 1998-99 was over and the assessment order had become final. In these circumstances, the court would not interfere with the assessment order. However, no penalty proceedings were to be initiated and no interest was to be recovered from the assessee if the tax was paid within 60 days. 3.3 Reliance has also been placed on the decision of this court in the case of CIT v. Sonal Construction Co. reported in [2015] 55 taxmann.com 425 (Guj) wherein at paragraph Nos. 6 and 7, it is observed as under : 6. We are taking this view in light of the factual scenario as it emerges and more particularly, paragraph 5 of the reasons given by the Tribunal which we propose to reproduce hereunder : '5. We have heard rival submission and perused material available on ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ty order. 3.5 Further reliance is placed on the decision of the apex court in the case of CIT v. Reliance Petroproducts P. Ltd. reported in [2010] 322 ITR 158 (SC) where it is observed as under (headnote) : A glance at the provisions of section 271(1)(c) of the Income-tax Act, 1961, suggests that in order to be covered by it, there has to be concealment of the particulars of the income of the assessee. Secondly, the assessee must have furnished inaccurate particulars of his income. The meaning of the word 'particulars' used in section 271(1)(c) would embrace the details of the claim made. Where no information given in the return is found to be incorrect or inaccurate, the assessee cannot be held guilty of furnishing inaccurate particulars. In order to expose the assessee to penalty, unless the case is strictly covered by the provision, the penalty provision cannot be invoked. By no stretch of imagination can making an incorrect claim tantamount to furnishing inaccurate particulars. There can be no dispute that everything would depend upon the return filed by the assessee, because that is the only document where the assessee can furnish the particulars of his incom ..... X X X X Extracts X X X X X X X X Extracts X X X X
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