2011 (3) TMI 1014

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....ollowing substantial questions of law have been claimed for determination of this Court:   " (a) Whether on the facts and in the circumstances of the case, Hon'ble Tribunal has erred in law in setting aside the order of CIT(A) and confirming the levy of penalty of Rs. 3,14,478/- under Section 271(1)(c)?   (b) Whether on the facts and in the circumstances of the case, Hon'ble Tribunal has erred in law in not following the decision of the Hon'ble Supreme Court in the case of CIT vs. Reliance Petro-products Pvt. Ltd. 322 ITR 158?   (c) Whether the Tribunal erred in applying Explanation 1(B) of Section 271(1)(c) in respect of charge of furnishing inaccurate particulars of income, contrary to express language of law conta....

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....l accepted the appeal and reversed the order of the CIT(A) and restored that of the assessing officer, by the order appealed against.   5. We have heard learned counsel for the appellant-assessee and perused the record.   6. Learned counsel for the assessee submitted that in the course of huge and voluminous transactions of sale of shares, a loss of Rs. 8,59,817/- disallowed under the provisions of Section 94(7) of the Act, could not have been taken as concealed income of the assessee, more so, when the assessee of its own, during the assessment proceedings, had surrendered the above amount subject to the condition of imposing no penalty and the calculation so made was even accepted by the Assessing Officer. Learned counsel ....

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....-1 to Section 271(1)(c) of the Act which envisaged that if the assessee fails to offer explanation in respect of any material fact relevant for computation of total income of the assessee, the amount added or disallowed in computing the income of such assessee as a result thereof, shall be considered as income deemed to represent the income in respect of which particulars have been concealed for the purpose of imposition of penalty under Section 271(1)(c) of the Act. The aforesaid Explanation further provides that even if any explanation was furnished by the assessee and the same was found to be false by the assessing officer, then also, the assessee is required to either substantiate such explanation or to prove that the same is bona fide ....