2015 (4) TMI 679

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.... on examination of the details found that the assessee had deliberately set-off long term capital loss of Rs. 39,37,081/- to arrive at a short term capital gain of Rs. 2,33,504/-. After disallowing the same, an addition of Rs. 41,70,585/- was made. However, the depreciation of Rs. 2,98,343/- was disallowed and income of letting out property was charged under the head 'Income from house property". The assessee accepted those transactions and paid tax. Thereafter, the revenue initiated penalty proceedings under Section 271(1)(c) of the Income Tax Act (for short the 'Act') on the ground that the assessee has deliberately concealed the income and furnished inaccurate particulars. The assessee contested the penalty proceedings and co....

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....n support of the said contention, reliance was placed on the judgment of the Apex Court in the case of Mak Data (P.) Ltd. v. CITreported in (2013) 358 ITR 593 (SC), wherein the Apex Court has held as under:- "7. The AO, in our view, shall not be carried away by the plea of the assessee like "voluntary disclosure", "buy peace", "avoid litigation", "amicable settlement", etc. to explain away its conduct. The question is whether the assessee has offered any explanation for concealment of particulars of income or furnishing inaccurate particulars of income. Explanation to Section 271(1) raises a presumption of concealment, when a difference is noticed by the AO, between reported and assessed income. The burden is then on the assessee to show o....

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.... survey proceedings under Section 133A conducted on 16-12-2003, in the case of a sister concern of the assessee. The survey was conducted more than 10 months before the assessee filed its return of income. Had it been the intention of the assessee to make full and true disclosure of its income, it would have filed the return declaring an income inclusive of the amount which was surrendered later during the course of the assessment proceedings. Consequently, it is clear that that the assessee had no intention to declare its true income. It is the statutory duty of the assessee to record all its transactions in the books of account, to explain the source of payments made by it and to declare its true income in the return of income filed by it....

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....entire facts have concurrently held that there is no deliberate suppression of income nor it is a case of furnishing of inaccurate particulars. It is a bona fide mistake and the moment the mistake was pointed out, the assessee has paid the tax. It is well settled that imposition of penalty is not automatic and therefore they have rightly set aside the order imposing the penalty. In fact, the order imposing penalty is contrary to law, declared by this court in the case of CIT v. Manjunatha Cotton & Ginning Factory reported in (2013) 359 ITR 565 (Karn), in as much as, it is clear from the order that there is no direction to initiate penalty proceedings. In the aforesaid judgment, it was held that it is imperative that the assessment order con....