TaxTMI 
TaxTMI 
2015 (10) TMI 810
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....2006 declaring total income of Rs. 10,28,830/-. The same was processed u/s 143(1). Statutory Notice u/s 143(2) was duly issued and the representative of the assessee attended from time to time, to file necessary details and evidences and produced books of account. The assessing office concluded the assessment on 30.12.2008, by making the following additions to the returned income: 1. Excess depreciation on Plant & achinery Rs. 24,56,003 2. Non-capitalization of expenditure a) Custom duty Rs. 3,50,021 b) Shipping expenses Rs. 98,766 3. Unpaid statutory liabilities u/s 43B Rs. 3,14,215 4. Late deposit of employees' share of PF & ESI Rs. 1,94,244 Rs. 34,13,249 4. There was no appeal against that was preferred by the assessee before the first appellate authority against the assessment order passed. Hence, the AO initiated the penalty proceedings u/s. 271(1) (c ) and finalized the penalty proceedings by levying penalty of Rs. 11,49,000/- by giving following reasons: "5. In the light of above observations, it is concluded that in all of the above issues the assessee fu....
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....laim of the assessee and added the same to the income. 3) Addition in respect of Unpaid statutory liabilities u/s 43B: The assessee had revised the statutory liabilities paid u/s 43B to an extent of Rs. 3,14,215/-. In the audit report annexed to the paper book at page 58, it was pointed out that the same has been paid before the due date for furnishing the return of income of the previous year u/s 139(1). However, the AO included the said amount while computing the income for the year under consideration being in violation of sec.43B of the Act. 4) Addition on the basis of late deposit of employees contribution towards PF & ESI The AO added an amount of Rs. 1,94,244/- on the ground that the amount was not paid within the due date prescribed under the Act. It is brought to the notice that there is a delay in depositing the employees contribution and it is submitted by the ld. AR that the same has been deposited beyond the due date which is 15th day of subsequent month. However the Ld. AR submitted that the same was deposited before the filing of the return. 8. The ld. AR also made his submissions that in the assessment order passed u/s.143(3) by the ld. AO, the satisf....
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.... record and the judgments relied upon by them. On merits it is observed that mistake of the assessee was bonafide which has been corrected by filing revised return before completion of assessment. Merely because there were some discrepancies, it cannot be held that the assessee intended to evade tax. The assessee had rectified the same and had accepted the mistake before the AO. The assessee also chose not to prefer appeal before the first appellate authority, itself shows that the mistakes were not wilfull. For this act of assessee penalty u/s 271(1)(c) may not be levied in respect of the addition made u/s 43B, the assessee had declared in the audit report the bonafide error which do not find place in the return filed by the assessee (PB page 58). The delayed payment in respect of employees' contribution to PF & ESI needs to be given liberal approach in view of the ratio laid down by the Hon'ble Delhi High Court in the case of CIT v. P.M. Electronics Ltd., 220 CTR 635 (Delhi) while relying upon the decision of Hon'ble Apex Court in the case of CIT Vs. Vinay Cement Ltd.,213 CTR (SC) 268 , concurred with the view taken by the Hon'ble Madras High Court in Nexus Computer (P) Ltd.,219 ....
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....h person offers an explanation which he is not able to substantiate and fails to prove that such explanation is bona fide and that all the facts relating to the same and material to the computation of his total income have been disclosed by him, then, the amount added or disallowed in computing the total income of such person as a result thereof shall, for the purposes of clause (c) of this sub-section, be deemed to represent the income in respect of which particulars have been concealed." 17. From the said provision, it is apparent that, if the ld. AO in the course of assessment proceedings is satisfied that, any person has concealed the particulars of income or furnished inaccurate particulars of such income, then he may levy penalty on the assessee. Thus, there are two different charges i.e. concealment of particulars of income or furnishing of inaccurate particulars of income. The penalty can be imposed only for a specific charge. Furnishing inaccurate particulars of income means, when the assessee has not disclosed the particulars correctly or the particulars disclosed by the assessee are found to be incorrect whereas, concealment of particulars of income means, when the as....