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TMI Blog2015 (2) TMI 1300X X X X Extracts X X X X X X X X Extracts X X X X ..... furnished inaccurate particulars of income. Mere wrong claim made by assessee cannot amount to concealment of income. In the case law of Price Waterhouse Coopers[2012 (9) TMI 775 - SUPREME COURT] the assessee had not added back to its computation of income the quantity as per the provisions of section 40A(7) of the Act. However, Hon'ble Supreme Court deleted the penalty holding that mistake was due to human error. In the present case, we observe that not adding back to the income of unallowable expenses, was due to a bona fide mistake which is strengthened from the fact that assessee had declared a loss of 153.35 lacs and even if the amount of 21.54 lacs was suo moto added back by assessee, still the income figure would have remained in neg ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t in EPF account but which were not paid by it to Government account and, therefore the amounts were disallowed and addition was made. Ld. CIT(A) had also dismissed the appeal of assessee. On receipt of appellate order, the assessee was provided an opportunity of being heard before imposition of penalty u/s. 271(1)(c). On behalf of assessee nobody attended therefore, A.O. after relying upon the provisions of Section 271(1)(c) imposed penalty of ₹ 8.50 lacs. Aggrieved, the assessee filed appeal before Ld. CIT(A). However, Ld. CIT(A) upheld the penalty by holding as under: "I have carefully considered the order of the AO and the submissions of the AR as also the contents of the case-laws referred to by the AO and the AR. The AR&# ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the word "conceal" means: "to hide or keep secret. The word 'conceal' is con + celare which implies to hide. It means to hide or withdraw from observation; to cover or keep from sight; to prevent the discovery of; to withhold knowledge of. The offence of concealment is, thus, a direct attempt to 'hide an item of income or a portion thereof from the knowledge of the Income-tax authorities." Similarly, the word 'inaccurate' has been interpreted as under: "not accurate, not exact or correct; not according to truth; erroneous; as an inaccurate -statement, copy or transcript." 55. It signifies a deliberate act or omission on the part of the assessee. Such deliberate act must be either f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... bt that penalty is leviable not only in a case where after addition of concealed income, a loss return after assessment becomes positive income, but also in a case where addition of concealed income reduces the returned loss and finally the assessed income is also a loss or a minus figure. In view of the facts of the case as-discussed above and the position of law, the penalty order is confirmed." 4. We find that penalty was imposed upon assessee on account of disallowance of ₹ 21,51,370/-, which the assessee had not deposited in EPF account after deducting the same from the employees. We find that though the disallowance in this case was warranted as the provisions of Section 43B were hit. However the fact remains that necessar ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... case of CIT v. Reliance Petro Products Pvt. Ltd. [(2010) 322 ITR 158 (SC)] has held that simply for the reason that the Assessing Officer did not find the claim of the assessee to be sustainable in law up to a certain extent, it cannot be a case for penalty u/s. 271(1)(c) more so when the particulars furnished by the assessee were not inaccurate. Similarly, the Hon'ble Supreme Court in Price Waterhouse Coopers Pvt. Ltd. v. CIT (2012) 348 ITR 306 (SC) has held that no penalty u/s. 271(1)(c) can be imposed for a bona fide mistake or a normal human error." 6. In the case law of Price Waterhouse Coopers, the assessee had not added back to its computation of income the quantity as per the provisions of section 40A(7) of the Act. How ..... X X X X Extracts X X X X X X X X Extracts X X X X
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