2013 (10) TMI 1179 - HC - Income Tax

Appellate Court Affirms Penalty for Incorrect Tax Information

Anish Kumar Versus Commissioner of Income Tax, Bathinda (Punjab)

Anish Kumar Versus Commissioner of Income Tax, Bathinda (Punjab) - TMI Issues:Challenge to penalty imposed by Income Tax Appellate Tribunal, assessment of intention to evade tax, incorrect particulars leading to penalty.Penalty Imposed by Income Tax Appellate Tribunal:The appellant challenged the penalty imposed by the Income Tax Appellate Tribunal, arguing that it was not justifiable as there was no finding indicating an intention to evade tax or intentional overstatement of the cost of acquisition of land. The appellant contended that the penalty was based on an inadvertent error, not sufficient to warrant such a penalty. However, the court found no substantial question of law to be adjudicated upon, as the appellant had sold properties in 2005 claiming purchase in 1991 and 1996, whereas records showed the actual purchase date as 1998. The Assessing Officer found discrepancies and imposed a penalty of 300%, later reduced to 100% by the Tribunal. The court upheld the Tribunal's decision, stating that the penalty was justified based on the incorrect particulars furnished.Assessment of Intention to Evade Tax:The court examined whether the appellant's actions indicated an intention to evade tax. It was noted that the appellant's failure to provide a clear and cogent explanation for the discrepancies in the cost of acquisition and purchase dates of the properties raised an inference of intent to evade tax. The court held that the findings of the Income Tax Appellate Tribunal, Commissioner of Income Tax (Appeals), and Assessing Officer regarding the appellant furnishing incorrect particulars with the intent to evade tax were legally sound and free from error. The absence of a satisfactory explanation for the discrepancies supported the conclusion that the appellant had indeed intended to evade tax.Incorrect Particulars Leading to Penalty:The court emphasized that the incorrect particulars provided by the appellant, specifically regarding the value of assets and the date of purchase, were crucial factors in determining the intention to evade tax. The appellant's inability to explain these discrepancies convincingly led to the inference that there was a deliberate attempt to evade tax. Consequently, the court dismissed the appeal, affirming the decisions of the lower authorities and upholding the penalty imposed by the Income Tax Appellate Tribunal.