TaxTMI 
TaxTMI 
2015 (7) TMI 650
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....pleted u/s 143(3) of the Act on 31.03.2009 at an income of Rs. 1,74,350/-. Subsequently, notice u/s 148 of the Act was issued to the assessee. However, the assessee did not furnish any return. Thereafter the AO issued notice u/s 142(1) of the Act on 19.04.2011 asking the assessee to furnish return in response to the already issued notice u/s 148 of the Act and also to submit photocopies of all bank account along with debit and credit entries for the period 01.04.2007 to 31.03.2008. In response the assessee filed a revised return declaring an income of Rs. 11,24,348/-. During Course of assessment proceedings, the AO noticed that the assessee under the status of HUF had received a gift of Rs. 10,00,000/- on 15.05.2006 from Sh. Sharat Chand Ja....
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.... assessee observed that the assessee was of a bonafide belief that the gift received by HUF from Karta/father of Karta was exempted under the provisions of the Act and that the said fact was accepted by the AO while passing the assessment order dated 31.03.2009 u/s 143(3) of the Act. The ld. CIT(A) further observed that the assessee before receiving the copy of reasons recorded, suo motu revised its return of income on 29.04.2011 and offered the amount received as gift for taxation. The said action of the assessee was considered as a voluntarily surrender as nothing specific of escapement of income was communicated before the return was revised. The ld. CIT(A) further observed that the gift had been received from the family member of the 'K....
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.... marriage of an individual or by way of inheritance have no application to the HUF, so it was quite evident that the assessee was under a bonafide belief that the gift was not taxable that is why the same was not included in the original return of income. It was stated that as soon as the assessee received notice u/s 148 of the Act, the return of income was revised, adding the said gift and all the due taxes were paid, therefore, penalty u/s 271(1)(c) of the Act was not leviable on the same. The reliance was placed on the following case laws: Price Waterhouse Coopers Pvt. Ltd. Vs Cit (2012) 348 ITR 308 (SC) CIT Vs Escorts Finance Ltd. (2010) 328 ITR 0044 (Del) CIT, Udaipur Vs The Udaipur Central Cooperative Bank Ltd., ITA No. 105/2013....
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....sessee at the most had committed, an inadvertent and bonafide error but did not intend to or attempted to conceal its income because the return of income was revised before receiving any notice u/s 142(1) of the Act from the AO. 8. On a similar issue the Hon'ble Jurisdictional High Court in the case of CIT Vs Escorts Finance Ltd. (supra) has held as under: "It is repeatedly held by the Courts that the penalty on the ground of concealment of particulars or non-disclosure of full particulars can be levied only when in the accounts/return an item has been suppressed dishonestly or the item has been claimed fraudulently or a bogus claim has been made. When the facts are clearly disclosed in the return of income, penalty cannot be levied and m....
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....ts total income. This can only be described as a human error which we are all prone to make. The caliber and expertise of the assessee has little or nothing to do with the inadvertent error. That the assessee should have been careful cannot be doubted, but the absence of due care, in a case such as the present, does not mean that the assessee is guilty of either furnishing inaccurate particulars or attempting to conceal its income. 20. We are of the opinion, given the peculiar facts of this case, that the imposition of penalty on the assessee is not justified. We are satisfied that the assessee had committed an inadvertent and bona fide error and had not intended to or attempted to either conceal its income or furnish inaccurate particula....