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TMI Blog2021 (8) TMI 24X X X X Extracts X X X X X X X X Extracts X X X X ..... nt has committed mistake while preparing the accounts as the credit note sent by the sundry creditor was not came to his notice and there was attempt for tax evasion as the assessee suffered loss. In our view it was sufficient explanation and reasonable within the scope of section 273B of the Income tax Act. Thus, we accept the secondary submissions of the ld AR for the assessee and direct the assessing officer to delete the penalty levied under section 271(1)(c) of the Act. Considering the facts that we have deleted the penalty on merit, therefore, the discussions and adjudication of the technical or legal issue, raised by issue, has become academic. In the result the grounds of appeal raised by the assessee are allowed. - ITA No.186/ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t be levied where the difference was due to genuine reason and there was no evidence to suggest that it was done with the consent or knowledge of the assessee. 5.The learned CIT(A) has erred in law and facts to confirm the penalty without considering that even if considered it as income in any of the year, there was no tax effect and to have a concealment of income and it is a just a periodical difference. 6. The learned CIT(A) has erred in law and facts to confirm that the income accrues when it has came to their knowledge and such type of discount was not out of any contract. 2. Brief facts of the case as gathered from the lower authorities are that the assessee is a Private Limited Company, filed its return of income for AY ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... not aware about the credit given to him at the time of finalization of account of said party. The assessee has not made the said mistake deliberately or with the intention to evade the tax. The assessee further stated that they undertake to consider the credit in current year and there is no tax liability in this Financial Year and subsequent year because of losses. The assessee explained that there is a genuine mistake and no penalty for concealment is leviable. 4. The explanation of assessee was not accepted. The AO held that it is a clear case of excess claim of creditors to the extent of ₹ 8,90,808/-. The AO held that assessee has committed a default for furnishing inaccurate particulars and concealed income to the extent of & ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tion of the notice, clearly indicating if it was issued for concealment of income or for furnishing inaccurate particulars of the income. Therefore, the assessing officer proceeded to levy penalty without application of specific charges against the assessee. To support his contention the ld AR for the assessee relied on the decision of the Hon ble Gujarat High Court in CIT Vs Lakhdhir Lalji (85 ITR 77 Guj) and ACIT Vs Dipesh M Panjwani (ITA No. 6330 /Mum/2012). 6. On the merit of the case the ld. AR for the assessee submits that the addition in the assessment is made under section 41 as there was no cessation of liability in earlier year. The ld AR for the assessee has taken us through the contents of the assessment order and would submi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rticulars of income. At the time of passing the penalty the assessing officer levied penalty for furnishing inaccurate particulars of income. So far as non- striking of the inappropriate portion in the show cause notice under section 274 read with section 271(1)(c), the assessee has not objected before the assessing officer. The assessee was very well aware about the charges of penalty. Further, the ld AR for the assessee has not shown any reasons as to whether, by not striking the inappropriate portion, the assessee or his representative were suffered any prejudice. The service of notice for initiating penalty is not statutory compliance. The Act speaks about providing the opportunity before levying the penalty, which has been provided and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ile finalising the accounts. The reply furnished by the assessee was not accepted by the assessing officer by taking view that the assessee made excess claim of creditors to the extent of ₹ 8,90,808/- and that committed a default for furnishing inaccurate particulars for furnishing inaccurate particulars of income. The ld CIT(A) confirmed the action of the assessing officer by taking view that the assessee failed to explain the excess liability and no further appeal was filed by the assessee against the additions. It is settled position under the law that the penalty proceedings are separate and independent. Merely no appeal is filed by the assessee, cannot be as basis of levying the penalty. Before us, the ld AR for the assessee vehe ..... X X X X Extracts X X X X X X X X Extracts X X X X
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