TaxTMI 
TaxTMI 
2012 (9) TMI 440
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....ublications (P) Ltd and has substantial interest in the company, as he is holding 67.40% of the shareholding. The company had reserves worth Rs. 82,16,753/-. As per the assessee's account in the company, he had a credit balance of Rs. 26,60,230/-. The Assessing Officer asked the assessee why the same be not added to the assessee's income as deemed dividend u/s 2 (22)(e). The assessee submitted that he also had a debit balance of Rs. 7,65,921/- with the company. The Assessing Officer added the difference of credit and debit balance amounting to Rs. 18,94,309/-. The assessee did not file any appeal against the addition. In penalty proceedings, the Assessing Officer held that the assessee had furnished inaccurate particulars of his income to t....
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....f; that dividend income is exempt u/s 10(34); that the income deemed to be dividend in the hands of the assessee was not taxable in terms of Section 10(34) and the income itself being exempt, there was no concealment of income or furnishing of inaccurate particulars of income, liable for penalty u/s 271(1)(c); that without prejudice, the assessee was not only the shareholder in the company, but also an employee thereof, working as executive director and drawing salary from the company; that the sum of Rs. 4,50,000/- was received by the assessee from the company on account of advance in the capacity of employee of the company; that the company gives such advances to all its employees in the normal course of business; that the sum of Rs. 6 la....
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....CTR 320(SC). 4. By virtue of the impugned order dated 30.12.2011, the Ld. CIT (A) confirmed the penalty. 5. Aggrieved, the assessee is in appeal before us. 6. The Ld. AR contended, as before the CIT (A), that the assessee was deriving income from rent and remuneration from Galgotia Publications Pvt. Ltd., a company in which the assessee was holding more than 67% shares during the year; that during the assessment proceedings of the company, the Assessing Officer noticed that the company had given advance of Rs. 26,60,230/- to the assessee; that the assessment proceedings in the assessee's case were also going on with the same Assessing Officer; that in the assessee's assessment proceedings, the assessee had submitted before t....
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....at Daryaganj which was given on rent to the company; that, so, no amount could be deemed to be dividend in terms of Section 2 (22)(e) of the IT Act; that the assessee did not know that any advance from the company, whether on account of advance in the capacity of an employee or otherwise is deemed to be income in the hands of the recipient; that the assessee was under the bona fide belief that only the income actually received or earned are taxed under the IT Act; that the books of account of the company were audited by a qualified CA and the factum of advance from the company being deemed to be income of the assessee was not brought to assessee's knowledge; that the assessee was under the bona fide belief that the dividend income is exempt....
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....ed CIT (A), which also confirms the acceptance by the assessee; and that, hence, there being no merit in the assessee's appeal, the same be dismissed. 8. We have heard the parties and have perused the material on record. The issue before us is as to whether the penalty levied has rightly been confirmed by the Ld. CIT (A). It remains undisputed that all the concerned facts were duly disclosed by the assessee in the assessment proceedings, stating that a sum of Rs. 7,65,921/- was due to the assessee from the company and also that the amounts received represented Rs. 6 lac as security deposit against property given on rent to the company and advance of Rs. 4,50,000/- received against salary in the capacity of director holding 67.40% of the ....
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.... the above, it is evident that all the concerned facts were duly placed by the assessee before the Assessing Officer during the assessment proceedings. Then, the copy of account of the assessee in the books of the company (APB-7) clearly shows the amount of Rs. 4,50,000/- and Rs. 6 lac debited therein. The disclosure made by the assessee is evident from this account also. 11. In 'Reliance Petroproducts Pvt. Ltd.', 230 CTR (SC) 320, it has been observed, inter alia, that where no information given in the return is found to be incorrect or inaccurate, the assessee cannot be held guilty of furnishing inaccurate particulars. The ratio of 'Reliance' (supra) is that if there is no concealment or furnishing of inaccurate particulars of income, ....