Penalty for inaccurate particulars upheld where foreign exchange loss was wrongly debited and later disclosure was not voluntary.

Penalty under section 271(1)(c) was sustained where the assessee debited foreign exchange loss to non-tonnage income and later claimed a mistake only after notices under sections 142(1) and 143(2) were issued. The authorities found that the loss had been wrongly booked to reduce taxable income and that the explanation was unsatisfactory. The HC treated the disclosure as non-voluntary, held that the assessee could not rely on authority dealing with a genuine computation error, and accepted the concurrent factual findings as neither perverse nor arbitrary. The penalty was therefore correctly upheld.

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Issues: Whether penalty under section 271(1)(c) of the Income-tax Act, 1961 was validly sustained on the ground that the assessee had concealed income or furnished inaccurate particulars by debiting foreign exchange loss to non-tonnage income and whether the alleged disclosure was voluntary.

Analysis: The assessee's claim of a mistake was made only after notices under sections 142(1) and 143(2) of the Income-tax Act, 1961 were issued and the Assessing Officer called for details of expenses and foreign exchange-related items. The authorities found that the loss had been wrongly debited to reduce non-tonnage income and that the explanation offered was not satisfactory. The Court held that the so-called disclosure was not voluntary, and the ratio of the decision relied upon by the assessee on a genuine computation error did not apply on these facts. The concurrent factual findings of the authorities below were neither perverse nor arbitrary.

Conclusion: The penalty under section 271(1)(c) was correctly upheld and the appeal failed.

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