TaxTMI 
TaxTMI 
2009 (8) TMI 1154
X X X X Extracts X X X X
X X X X Extracts X X X X
....ccount of short term capital gain which worked out on the sale of cars. (b) Disallowance of expenditure of Rs. 6,86,436/- which was given by the assessed under the head "Professional Development Expenses" (c) Disallowance of expenses to the tune of Rs. 12,26,000/- under the head ?Advertisement?. While doing so, the Assessing Officer also initiated the penalty proceedings against the assessee under Section 271(1)(c) of the Income Tax Act and passed penalty order dated 30th October, 2001. This order was upheld by the C.I.T.(A), however, the Tribunal has set aside the penalty order stating that there was no concealment of income or furnishing of inaccurate particulars. We may note that the three additions which were made by the Assess....
X X X X Extracts X X X X
X X X X Extracts X X X X
....any documentary proof in respect of business necessity of this expenses. As the assessee is failed to file any nexus between this foreign tour and the business of the assessee the same is treated as purely non business of its director. Hence, the expenses amounting to Rs. 6,86,436/- are disallowed and added back to the income of the assessee. 7. The assessee company has debited Rs. 12,26,000/- under the head "Advertisement". Since, assessee's source of income is mainly interest on tax free bond, dividend income and rental income assessee was asked to explain why such heavy expenses has been incurred in advertisement and how the expenses is related to the business of the assessee. The assessee vide reply dated 26.09.2000 has submitted ....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... the assessee. The Assessing Officer had made addition of Rs. 1,47,901/- on account of capital gain on sale of six cars which was accepted by the assessee as its mistake. We also observe that the Assessing Officer had disallowed the claim of expenses of Rs. 3 lakhs as the same could not be allowed as deduction against the tax free income of assessee. We also observe that in the assessment order framed the Assessing Officer had not recorded and finding to the effect that the assessee had filed inaccurate particulars of his income or had concealed its income. The Hon'ble Delhi High Court in the case of CIT Vs. Ram Commercial Enterprises Ltd., 2/6 ITR 568, in the case of CIT Vs. Super Metal Re-roller, 265 ITR 82, and in the case of CIT Vs. B.R....
X X X X Extracts X X X X
X X X X Extracts X X X X
....le Delhi High Court in the case of CIT Vs. Chetan Das Laxman Das, 214 ITR 726, and CIT Vs. J.K. Synthetics Ltd., reported in 219 ITR 267, are on this proposition. Further, the Chandigarh bench of the Tribunal in the case of H.P. State Forest Corporation Ltd. Vs. Dy.CIT 93 ITD 422, has hold that the word "conceal" means to hide or to withhold or not to disclose. This requirement some positive action on the part of the person concerned. Where the assessee had disclosed all the facts before the Assessing Officer and the Assessing Officer, on consideration of the evidence furnished by the assessee, come to the conclusion that the claim has not been substantiated with sufficient evidence, does not automatically result in levy of penalty. Wher....