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TMI Blog2016 (12) TMI 1089X X X X Extracts X X X X X X X X Extracts X X X X ..... er the provisions of Section 271 (1) (c) of the Act. - Decided in favour of assessee - Income Tax Appeal No. 125 of 2002 - - - Dated:- 19-12-2016 - Hon'ble Bharati Sapru And Hon'ble Vinod Kumar Misra, JJ. For the Appellant : R. S. Agrawal For the Respondent : A.N. Mahajan, Ashok Kumar, Bharatji Agarwal, D. Awasthi, G.Krishna, R.K. Upadhaya, S Chopra ORDER Heard Shri S.D. Singh, learned Senior Counsel assisted by Shri R.S. Agrawal, learned counsel for the appellant and Shri Shubham Agrawal, learned counsel for the department. This appeal has been filed by the assessee under Section 260A of the Income Tax Act, 1961 against the order passed by the Tribunal dated 26.06.2002 for the assessment year 1982-83. Th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... gainst this, the assessment was completed at an income of ₹ 15,28,83,602/- after making various additions/disallowances, vide regular assessment order dated 29.03.1985. With the completion of assessment (at such a high pitched figure) the penalty proceedings under Section 271 (1) (c) of the Income Tax Act (hereinafter refererred to as the 'Act') were initiated by making following narration:- It is further noticed that the assessee has committed the default u/s 271(1)(c). It concealed the particulars of its income and also furnished inaccurate particulars of such income e.g. disallowances u/s 40A(5), guest house expenses, provision on account of excise duty and other liabilities, excise duty refund, depreciation allowance ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... llowances aggregating of ₹ 98,90,300 which had been sought to be made the basis of levying penalty under Section 271(1) (c) of the Act was submitted before the assessing officer. The submissions so made by the assessee/appellant at the stage of the Assessing Officer were not found to be acceptable and the Assessing Officer levied a penalty of ₹ 60,00,000. Against the said penalty order, the assessee/appellant preferred an appeal before the C.I.T. (Appeals), New Delhi who decided the same vide order dated 15.11.1993. After examining the explanation submitted by the assessee/appellant, in response to the show-cause notice, he recorded a categorical finding that all the expenses/claims aggregating ₹ 98,90,300/- disallow ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... provisions of Section 35 (2) (b) Explanation (iv) of the Act, but at the same time learned Counsel for the department also does not deny the fact that the very provision was under challenged before the Supreme Court and also its retrospectivity was also been challenged and the Hon'ble Apex Court had also granted stay order in this matter and in any view of the matter, the matter was a debatable one at the relevant time i.e. the time relating to the period of assessment. Learned Counsel for the assessee has sough to argue that the imposition of penalty under Section 271 (1) (c) of the Act clearly contemplates that the penalty may be imposed only in cases where there has been some false declaration or where there has been some concealm ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... x Court has held that in a case where there was no finding that there were any details supplied by the assessee, which were found to be incorrect or erroneous or false, it would not attract penalty under Section 271 (1) (c) of the Act. A mere making of a claim, which is not sustainable in law by itself would not amount to furnishing inaccurate particulars regarding the income of the assessee. In the present case also there is not even a remote suggestion of there being any falsehood of about there being any material details and particulars supplied by the assessee to the department. It is true that their claim was not accepted but that not in itself comes to the inevitable conclusion that the details supplied by the assessee were false, ..... X X X X Extracts X X X X X X X X Extracts X X X X
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