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TMI Blog2022 (8) TMI 1126X X X X Extracts X X X X X X X X Extracts X X X X ..... e Act" in short). 2. The assessee, in the present case, is a company which is engaged in the business of manufacturing and trading in laminated sheets. The return of income for the year under consideration was filed by it on 28.09.2015 declaring a total income of Rs.1,00,28,180/-. In the assessment completed under Section 143(3) of the Act vide an order dated 22.11.2017, the total income of the assessee was determined by the Assessing Officer at Rs.1,21,41,220/- after making inter alia an addition of Rs.3,25,499/- on account of loss on sale of assets debited by the assessee-company in the profit and loss account. Penalty proceedings under Section 271(1)(c) of the Act were also initiated by the Assessing Officer. In response to the notice i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... red the return of income, was not added back to the income while preparing the return of income. Since, this was a glaring mistake, the addition in respect of the same was made by the Ld. Assessing Officer and the Appellant Company did not even preferred an Appeal against the same. However, it may be noted that the same was a genuine mistake without any intention to avoid tax. We would like to state that said amount had already been shown in Tax Audit Report u/s 44AB at clause No. 21(a)(i), as Expenditure of Capital nature and there was no willful suppression or misrepresentation of facts by the appellant company. The appellant Company relies on the decision of Hon'ble Apex court in case of Price Water house Coopers Pvt. Ltd Vs. C ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... confirmed in quantum appeals, does not become a sufficient ground for levy of penalty." 4. The learned CIT(A) did not find merit in the submission made by the assessee and proceeded to confirm the penalty imposed by the Assessing Officer under Section 271(1)(c) of the Act for the following reason given in paragraph No. 3.2 of his impugned order:- "I have carefully considered the facts of the case, penalty order and written submission filed by the appellant. The Assessing Officer has levied penalty on addition of loss of sale of assets of Rs. 3,35,499/- which was required to be added In the total income but was not added by the appellant. The appellant has submitted that due to human error the addition of loss on sale of assets could not ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ttention to the copy of profit and loss account placed at page no. 50 of the paper-book to point out that the amount of Rs.3,35,499/- was debited therein with a clear description "Loss on Sale of Fixed Assets". He also invited our attention to the relevant portion of the Tax Audit Report at page no.60 of the paper-book to show that loss on sale of fixed asset of Rs.3,35,499/- was clearly stated as expenditure of capital nature. He contended that these details and documents furnished by the assessee-company along with its return of income clearly show that the relevant particulars were fully and truly furnished by the assessee and the mistake in not adding back the loss of Rs.3,35,499/- on sale of assets in the computation of income was a bo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... llowable as deduction being expenditure of capital nature and since the same was not added back by the assessee-ITA company in the computation of income, the Assessing Officer added the said amount to the total income of the assessee and also imposed penalty under Section 271(1)(c) of the Act holding that it was a case of furnishing of inaccurate particulars of its income by the assessee. He rejected the explanation of the assessee that there was an inadvertent mistake in not adding back the amount in question on account of loss on sale of fixed assets in the computation of income on the ground that it was a case of a company and books of accounts were prepared and audited by professionals. The learned CIT(A) also agreed with the view of th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... total income and oblige. We are very much regret for the above mistake of the clerk." 9. Keeping in view this submission made by the assessee in writing during the course of assessment proceedings itself as well as the further details already furnished by the assessee along with its return of income giving full and true details of the loss as well as its capital nature, we find merit in the contention of the learned Counsel for the assessee that the mistake in not adding back the loss on sale of fixed assets in computation of income was a bona fide mistake inadvertently committed by the assessee. In the case of Price Waterhouse Coopers Pvt Ltd (supra) relied upon by the learned Counsel for the assessee, the Hon'ble Supreme Court held tha ..... X X X X Extracts X X X X X X X X Extracts X X X X
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