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TMI Blog2018 (2) TMI 1140X X X X Extracts X X X X X X X X Extracts X X X X ..... assessee was wrong and the audit expenses in question were incurred on the Audit staff, which did not include Articled Clerks undergoing training with the assessee-firm as per the stipulation of the ICAI. No doubt, the assessee firm also failed to bring anything on record to support and substantiate its explanation but such failure, in our opinion, can justify the addition made by the Assessing Officer to the value of Fringe Benefit but not the imposition of penalty under section 271(1)(d), especially when the audit expenses were separately debited by the assessee-firm in its Profit & Loss Account and all the relevant details of the same were fully and truly furnished by the assessee during the course of assessment proceedings before t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n into account while calculating the value of Fringe Benefit and since it was not done by the assessee, he required the assessee to offer its explanation in the matter. In reply, it was submitted by the assessee that the audit expenses were incurred for Articled Clerks, who were C.A. students receiving training and since there was no employer-employee relationship between the assessee and the said Articled Clerks, the audit expenses did not fall under the ambit of FBT. This explanation offered by the assessee was not found acceptable by the Assessing Officer keeping in view that it was specifically submitted by the assessee during the course of assessment proceedings that the audit expenses were incurred by its Audit Staff and Audit Clerks ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... unjustified. For that the matter in the Ld. I.T.O's order was one pertaining to point of law where there is difference of opinion, but the same cannot be fit for application of penalty. It may be noted that penal provisions of 271(1)(d) is applicable where the assessee has concealed the particulars of the fringe benefits or furnished inaccurate particulars of such fringe benefits . In this case, no such furnishing of inaccurate particulars or concealment of particulars of fringe benefit was made as the concerned expenses were debited and properly shown in Profit Loss Account. In the instant case your goodself will appreciate from the perusal of the above fact that the assessee did not have any intention to conceal any fa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cision of apex court, we respectfully submit that captioned proceedings u1s.271(1)(d) of the Act be dropped as the addition made by Ld AO was consequent to the suo moto acceptance of the assessee that the above said mistake was a casual mistake made while calculating/he value for the purpose of FBT and was not due to the detection of any concealment of facts or the inaccurate particulars by the Ld AO. Reliance is also placed in the judgment passed by the Income Tax Appellate Tribunal Delhi Bench 'A', New Delhi in the case of Ahaar Consumer Products Pvt. Ltd. Vs. Income Tax Officer, Ward-l(2), New Delhi wherein it was held that, We have considered rival contentions and have gone through the entire material available on recor ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is unjustified. 4. The above submission filed by the assessee was not found acceptable by the ld. CIT(Appeals) and he proceeded to confirm the penalty imposed by the Assessing Officer under section 271(1)(d) for the following reasons given in paragraph no. 5 of his impugned order:- 5. I have duly considered the submission of the assessee in the light of the facts of the case and the judicial pronouncements relied upon. The assessee had debited expenses ofRs.5,19,238/- as audit expenses in the return. However, the AO found the same as fringe benefit to the employees after examination of accounts and the assessee had not disputed AO's decision. The issue in hands is to decide whether the assessee had any intention to conceal th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... did not fall under the ambit of FBT. Although this claim of the assessee was not accepted by the Assessing Officer on the ground that it was specifically submitted by the assessee earlier that the audit expenses were incurred by its Audit staff and Audit Clerks without any reference to the Articled Clerks undergoing training with it, it is observed that nothing has been brought on record by the Assessing Officer to establish that the claim of the assessee was wrong and the audit expenses in question were incurred on the Audit staff, which did not include Articled Clerks undergoing training with the assessee-firm as per the stipulation of the ICAI. No doubt, the assessee firm also failed to bring anything on record to support and substantia ..... X X X X Extracts X X X X X X X X Extracts X X X X
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