9911796707
TMI Blog2018 (10) TMI 793X X X X Extracts X X X X X X X X Extracts X X X X ..... ty of Rs. 20.39 lacs levied u/s 271(1)(c) despite the fact that the corresponding quantum addition was accepted by the assessee. 2. The CIT(A) has not appreciated the fact that the assessee had claimed interest expenses in contravention of the provisions of section 43B in the Return of Income which tantamount to furnishing of inaccurate particulars of income liable to penalty u/s 271(1)(c) of the Act." 3. The short question that we are thus required to adjudicate is whether or not learned CIT(A) was justified in upholding the impugned penalty of Rs. 20,39,809/-. 4. The issue in appeal lies in a narrow compass of material facts. The assessee before us is a company engaged in the business of manufacturing and trading the cotton yarn. The ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... id unpaid interest of Rs. 56,85,881/- in the computation of income. Therefore, the same is added to the total income u/s.43B of the Act. It is pertinent to note here that that the assessee not preferred an appeal against this issue. This indicates that the assessee has agreed to furnish inaccurate particulars of income. The assessee has furnished the inaccurate particulars after unpaid interest not offered by the assessee. The assessee has to offer the same. It is pertinent to note here that in the present order clear findings have been made with respect to the inaccuracy, error and falsity of details filed by the assessee company in his return of income, thus, the present order is very-much in accordance with the position of Law as laid ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he assessee could have been benefited by filling inaccurate particulars of income. The assessee took chance with the department. Had the revenue not detected the inaccurate particulars of income of the assessee, the assessee could have enjoyed the fruits of filing inaccurate of particulars of income and would have caused loss to the revenue. In view of above facts and legal position discussed in para 3 (supra), the assessee is held to have furnished inaccurate particulars of income in the return of income filed by him and as per decision of Hon'ble Supreme Court in the case of Reliance Petroproduct (P) Ltd. (noted above) the liability of penalty arises. 5. In view of the above facts I am satisfied that the assessee has furnished i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the Ld. A.R. are that the appellant had admitted loss of over Rs. 2.25 crores; even after the disallowance u/s 43B the loss determined was over Rs. 1.68 crores; the facts and figures of the interest payable to GIG were duly declared in clause 21B of Annexure-IV to the audit report; however, due to inadvertent human error it was not added in the computation of income; appellant company's business was closed down subsequently; accumulated brought forward losses upto A.Y.2007-08 were of Rs. 3.36 crores; thus there was no loss of revenue and therefore levy of penalty was not warranted. 4.4 I have considered the facts of the matter. All the necessary particulars regarding the non-payment of interest were disclosed in the tax audit repo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... fore Board for Industrial and Financial Reconstruction (BIFR). In the light of these background facts, the assessee's claim of having missed adding back the inadmissible interest deduction on account of a bonafide and inadvertent mistake cannot be rejected as improbable. It is more of a silly mistake than an attempt to evade tax or furnish inaccurate particulars. The explanation of the assessee is thus a plausible explanation. As to what should be the judicial approach to the explanation of the assessee in such a situation, we find guidance from Hon'ble Supreme Court's judgment in the case of Price Waterhouse Coopers Pvt Ltd Vs. CIT [(2012) 348 ITR 306 (SC)] wherein Their Lordships have, inter alia, observed as follows:- "17. Having heard ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... advertent error. That the assessee should have been careful cannot be doubted, but the absence of due care, in a case such as the present does not mean that the assessed is guilty of either furnishing inaccurate particulars or attempting to conceal its income. 20. We are of the opinion, given the peculiar facts of this case, that the imposition of penalty on the assessee is not justified. We are satisfied that the assessee had committed an inadvertent and bona fide error and had not intended to or attempted to either conceal its income or furnish inaccurate particulars." 9. We may also add that while examining the explanation of the assessee, one has to see is whether the explanation is an explanation acceptable to a fact finding autho ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
