AI Drafter 
TaxTMI 
TaxTMI 
2016 (6) TMI 29
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....)(c) of the Income-tax Act, 1961 (hereinafter 'the Act') qua the assessment year 2009-10 on the grounds inter alia that :- "1.a That the Ld. CIT (A) - VI erred both in facts and in law while sustaining the penalty of Rs. 1,56,154/- under section 271 (1)(c) levied by the assessing officer for alleged concealment of income of Rs. 4,59,714/-. 1.b That while imposing penalty under section 271(1)(c) the Ld. CIT (A)-VI erred in concluding that the assessee had concealed the income. 1.c That the ld. CIT (A) - VI failed to appreciate that the omission was inadvertent and bonafide and levy of penalty under such circumstances is patently void and illegal. 2. That the order passed by the Ld. CIT (A) is bad in law and against the facts of the ....
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....one through the documents relied upon and orders passed by the revenue authorities below in the light of the facts and circumstances of the case. 5. The ld. AR for the assessee challenging the impugned order contended inter alia that due to inadvertent mistake in the audited account, the assessee has disclosed provision for bad debts of Rs. 4,59,714/-, which were not disallowed by her accountant while computing the taxable income; that during the assessment proceedings vide letter dated 30.11.2011, the assessee admitted that there was bonafide mistake and then revised the income by adding the provision of bad debts to its taxable income along with necessary details; that though the amount was written off during the financial year 2009-10....
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....Rs. 459714/- in Profit and loss accounts under the head Administration and other expenses. The provisions are not allowable as per act being an unascertained liability. Accordingly the assessee company vide order sheet entry dated 17.11.2011 dated show caused as to why the disallowance on account of provisions for doubtful debts should not be disallowed. In response the assessee company vide letter dated 30.11.2011 submitted as under:- "it is submitted that the assessee has .filed its income tax return for the AY 2009-10 at taxable income of Rs. 11489690/-. The assessee while filing the income tax return has inadvertently claimed deduction for provision for doubtful debts amounting to Rs. 459714/-. It is submitted that the mistake was bo....
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....e computed on the basis of original computation of income. In view of the submission of the assessee offering provision for doubtful debts amounting to Rs. 459714/- and provisions of act whereby provisions are not allowable being unascertained liability. Hence amount of Rs. 459714/- is hereby disallowed and added back to the income of the assessee company." 9. The plea of inadvertent mistake raised by the assessee has also not been accepted by the CIT (A) who has affirmed the findings returned by the AO. 10. A perusal of the balance sheet for AY 2008-09, lying at pages 5 to 10 of the paper book, schedule VI apparently shows that the assessee claimed an amount of Rs. 4,59,714/- on account of provision for doubtful debts and when this f....
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....d make a "silly" mistake. The fact that the tax audit report was filed along with the return and that it unequivocally stated that the provision for payment was not allowable under section 40A(7) of the Act indicated that the assessee made a computation error in its return of income. The contents of the tax audit report suggested that there was no question of the assessee concealing its income or of the assessee furnishing any inaccurate particulars. Apart from the fact that the assessee did not notice the error, it was not even noticed even by the Assessing Officer who framed the assessment order. All that had happened was that through a bona fide and inadvertent error, the assessee while submitting its return, failed to add the provision ....