Tax Tribunal: No penalty without intent to evade tax. Bona fide actions. Penalty order set aside.

The Tribunal held that the penalty under Section 271(1)(c) of the Income Tax Act cannot be imposed without evidence of deliberate intention to evade tax. As the assessee's actions were found to be bona fide and there was no conscious or mala fide furnishing of inaccurate particulars, the penalty order was set aside. The appeal was allowed, and the Assessing Officer was directed to delete the penalty.

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Issues Involved:
1. Legality of the penalty levied under Section 271(1)(c) of the Income Tax Act.
2. Assessment of whether the assessee furnished inaccurate particulars of income.
3. Determination of the bona fide nature of the assessee's actions regarding the depreciation claim.

Issue-wise Detailed Analysis:

1. Legality of the Penalty Levied under Section 271(1)(c):
The appeal was preferred by the assessee against the order of the Commissioner of Income Tax (Appeals)-IV, New Delhi, which confirmed the penalty order dated 31.01.2013 under Section 271(1)(c) of the Income Tax Act, upholding a penalty of Rs. 50,98,500/-. The main contention of the assessee was that the penalty was bad in law and on facts.

2. Assessment of Whether the Assessee Furnished Inaccurate Particulars of Income:
The assessee had capitalized a sum of Rs. 20.18 crores under fixed assets for Amritsar Airport and claimed depreciation. The Assessing Officer (AO) found that only Rs. 14.62 crores were completed during the previous year and disallowed depreciation on Rs. 5.56 crores, leading to a disallowance of Rs. 1.5 crores. The AO initiated penalty proceedings, asserting that the assessee furnished inaccurate particulars of income. However, the Tribunal noted that the assessee, a public sector undertaking, had filed its return before the Comptroller & Auditor General (C&AG) made observations. The assessee reversed the depreciation claim in the subsequent year voluntarily, indicating no mala fide intention.

3. Determination of the Bona Fide Nature of the Assessee's Actions Regarding the Depreciation Claim:
The Tribunal observed that the assessee revised its depreciation claim in the return for AY 2009-10 based on the C&AG's report, which was after the return for AY 2008-09 was filed. The Tribunal found the assessee's actions bona fide, as it reversed the claim voluntarily before the AO raised the issue. The Tribunal relied on various judgments, including those of the Supreme Court and High Courts, emphasizing that mere incorrect claims do not amount to furnishing inaccurate particulars unless there is a deliberate intention to evade tax.

Conclusion:
The Tribunal concluded that the penalty under Section 271(1)(c) cannot be imposed merely because it is lawful to do so. It must be shown that the assessee concealed particulars of income or furnished inaccurate particulars. The Tribunal held that the assessee's explanation was bona fide and sustainable, and there was no conscious or mala fide furnishing of inaccurate particulars. Consequently, the penalty order and the CIT(A)'s order were set aside, and the AO was directed to delete the penalty.

Judgment:
The appeal of the assessee was allowed, and the AO was directed to delete the penalty. The decision was pronounced in the open Court on 27th April 2015.

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