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TMI Blog2014 (8) TMI 1113X X X X Extracts X X X X X X X X Extracts X X X X ..... their own. When the AO himself has allowed the commission of ₹ 5,00,000/- having been paid to Mr. Sanjeev Khurana, merely disallowing the commission payment on the basis of subjective satisfaction without calling upon the assessee as to what type of advice and know-how has been provided by Ms. Divya Khanna to earn the business income on which tax has already been paid, the penalty cannot be imposed nor does it amount to furnishing of inaccurate particulars. So, in the given circumstances, we are unable to hold that the assessee has furnished inaccurate particulars of income for making payment of ₹ 6,00,000/- to Ms. Divya Khanna so as to attract the penalty u/s 271(1)(c) of the Act, hence we hereby delete the penalty by allow ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the A.O. and CIT(A) are not relevant to my this case hence the order is not as per merits of the case. 6. That the penalty of ₹ 181800 imposed u/s 271(1(c) by the A.O. and upheld u/s 250 by the CIT(A) be deleted in the interest of equity and merits of the case. 2. Briefly stated the facts necessary for adjudication of the controversy at hand are : On the basis of completed assessment under section 143(3) of the Income-tax Act, 1961 (for short the Act ) at the total income of ₹ 60,43,239/- as against the returned income of ₹ 46,81,685/- and taxable income u/s 115JB of the Act on book profit of ₹ 3,64,48,077/-, penalty proceedings were initiated u/s 271(1)(c) of the Act by way of issuance of notice u/s 27 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e the Tribunal by challenging the penalty order passed u/s 271(1)(c) of the Act. 6. We have heard the ld. Authorized Representatives of the parties to the appeal, gone through the documents relied upon and orders passed by the revenue authorities below in the light of the facts and circumstances of the case. 7. Undisputedly, the assessee is engaged in the business of derivatives, jobbing and investment; that the assessment order passed u/s 143 (3) of the Act has since attained finality having not been challenged further by the assessee; that the assessee debited an amount of ₹ 11,00,000/- on account of professional and management charges paid to Ms. Divya Khanna and Mr. Sanjeev Khurana to the tune of ₹ 6,00,000/- and ͅ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nished any reply nor attended any proceedings. At the time of assessment proceedings also Ms. Divya Khanna was not produced rather her father attended the proceedings. I am convinced that with a clear view to reduce tax liability assessee has debited this inadmissible expenses of ₹ 600000/-. 10. Bare perusal of the penalty order apparently goes to prove that there is no finding whatsoever on the part of the revenue authorities that any details supplied by assessee in his return is found to be incorrect or erroneous or false. In case the assessee has claimed any deduction or exemption, it is for the tax authorities to examine if the same is sustainable or not. 11. When we examine the penalty order in the light of the decision ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... truth or erroneous. Where there is no finding that any details supplied by the assessee in its return are found to be incorrect or erroneous or false there is no question of inviting the penalty under section 271(1)(c). A mere making of a claim, which is not sustainable in law, by itself, will not amount to furnishing inaccurate particulars regarding the income of the assessee. Such a claim made in the return cannot amount to furnishing inaccurate particulars. 12. In the instant case, when the AO has not disputed the particulars of income furnished by the assessee nor he has disputed the amount on which commission is claimed to have been paid by the assessee, the disallowance on the ground of challenging the capabilities of ..... X X X X Extracts X X X X X X X X Extracts X X X X
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