2016 (4) TMI 942

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....ccording to the ld. Counsel, the assessee is a non- resident and made several deposits in the scheduled bank. The ld. Counsel further submitted that the interest earned by the assessee on the deposits made Non-resident External account is exempt u/s 10(4)(i) of the Act. The assessee has subsequently converted the deposits into Non-resident Non-repatriable account in 2001. The interest was still exempt from taxation u/s 10(15) of the Act. According to the ld. Counsel, the Assessing Officer's contention that the entire interest receipt of Rs. 4,69,43,615/- was taxable for the assessment year 2005-06 has not been approved by the CIT(A) and the amount taxable during the assessment year 2006-07 has been determined at Rs. 33,69,100/-. The Ass....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....naccurate particulars of income. The ld. Counsel further submitted that even if the claim made by the assessee that the interest income was exempted from taxation is not correct, still that cannot be a reason to levy penalty in view of the judgment of the Apex Court in CIT vs Reliance Petroproducts Pvt. Ltd, 322 ITR 158. 2. On the contrary, Shri Sasikumar, ld. Departmental Representative submitted that during the assessment proceedings, the Assessing Officer found that the assessee was following cash system of accounting, therefore, the interest income of Rs. 4,69,43,615/- is taxable during the assessment year 2005-06. The assessee claimed before the CIT(A) that he was following mercantile system of accounting, therefore, the interest in....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....e account deposits is not entitled for exemption u/s 10(4) of the Act. Accordingly, the interest on the Non-resident Non-repatriable account deposits was added to the total income. The Assessing Officer has also levied penalty u/s 271(1)(c) of the Act on the ground that the claim made by the assessee that the interest on the Non-resident Non-repatriable account deposits is exempted from taxation. This Tribunal is of the considered opinion that after furnishing all the details for making a claim before the Assessing Officer under the Income-tax Act, 1961, cannot be construed as furnishing inaccurate particulars of income. The details of deposits made by the assessee and the interest accrued on such deposits are very much available before the....