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TMI Blog2022 (8) TMI 452X X X X Extracts X X X X X X X X Extracts X X X X ..... RAS HIGH COURT] wherein, it was held that mere making of a claim, which is not sustainable in law, by itself, would not amount to furnishing of inaccurate particulars regarding the income of the assessee and that such a claim made in the return cannot amount to furnishing inaccurate particulars, we set aside the orders of authorities below and delete the penalty levied under section 271(1)(c) of the Act. - Decided in favour of assessee. - I.T.A. No. 3002/Chny/2019 - - - Dated:- 3-8-2022 - Shri V. Durga Rao , Judicial Member And Shri Manoj Kumar Aggarwal , Accountant Member Appellant by : Shri S. Rajagopalan , C. A. Respondent by : Mrs. L. Jancy Elizabeth Rani , JCIT ORDER PER V. DURGA RAO , JUDICIAL MEMBER : T ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... not in accordance with the provisions of the Act and accordingly, the Assessing Officer disallowed the claim of ₹. 20,17,466/- and added back to the total income. On appeal, the ld. CIT(A) confirmed the disallowance made by the Assessing Officer. Consequent upon the confirmation of the disallowance, the Assessing Officer initiated penalty proceedings by issuing notice under section 271(1)(c) of the Act and levied penalty of ₹.6,11,292/-. On appeal, the ld. CIT(A) confirmed the penalty levied under section 271(1)(c) of the Act. 3. On being aggrieved, the assessee is in appeal before the Tribunal. The ld. Counsel for the assessee has submitted that the findings given in the assessment proceedings cannot constitute conclusive e ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that the merely making a claim, which is not sustainable in law, by itself, will not amount to furnishing of inaccurate particulars of income. By relying upon the decision of the Hon ble Supreme Court in the case of CIT v. Reliance Petroproducts P. Ltd. (supra), in the case of CIT v. Cholamandalam Investment Finance Co. Ltd. 364 ITR 680, the Hon ble Jurisdictional High Court has observed as under: 8. In order to invoke the penalty proceedings under Section 271(1)(c) of the Act, the Revenue should prove that the claim made was not sustainable in law and if the assessee had made a concealment of the particular income. The Hon'ble Supreme Court in the case of CIT vs. Reliance Petroproducts Pvt., Ltd., (SC), reported in [2010] 322 I ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rt held as follows:- Merely because the assessee had claimed the expenditure, which claim was not accepted or was not acceptable to the Revenue, that by itself would not, in our opinion, attract the penalty under Section 271(1)(c). If we accept the contention of the Revenue then in case of every return where the claim made is not accepted by the Assessing Officer for any reason, the assessee will invite penalty under Section 271(1)(c). That is clearly not the intendment of the legislature . 6. The ld. DR could not controvert the judgement of the Hon ble Supreme Court in the case of CIT v. Reliance Petroproducts P. Ltd. (supra). Respectfully following the judgement of the Hon ble Supreme Court wherein, it was held that making an i ..... X X X X Extracts X X X X X X X X Extracts X X X X
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