TaxTMI 
TaxTMI 
TaxTMI 
2016 (6) TMI 939
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....s. 1. 94 crores. The Assessing Officer (AO) completed assessment on 21/03/2006, u/s. 143 (3) of the Act, determining the income of the assessee at Rs. (-)12. 14lakhs. During the assessment proceedings, the AO found that it had claimed Rs. 1. 82 crores as provision for loss of stock and had debited the said amount in the profit and loss account. After considering the submission of the assessee with regard to the claim, the AO held that the assessee had made merely a provision in the year under appeal, that the loss claimed by it had not been quantified by any authority, that it was only statement of the assessee that the stock had no realisable value, that there was no supporting evidence to substitute the claim, that the claim made by the a....
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....reatment of loss claimed by the assessee, that the difference did not amount to concealment or furnishing of inaccurate particulars, that the claim was made under bona-fide belief that same was legally allowable. After considering the submission of the assessee, the AO held that the assessee had not furnished any supporting documents/evidences even during the appellate proceedings to establish its own of identity shoves, that his predecessor had noted that the assessee became a member of an environment control board only on 11/03/ 2006, that the letter of Gujarat Pollution Control Board was dated 27/09/2005, that the assessee had concealed the particulars of its income as well as had filed inaccurate particulars. Therefore, he levied a pen....
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....s disallowed was not sufficient to impose concealment penalty. After considering the assessment order, penalty order and the submission of the assessee, the FAA held that the stock was neither ascertained nor actually ceased to exist as such, that the claim was made in the return without producing any supporting evidences, that it was clear case of furnishing inaccurate particulars of income, that the order of the then FAA, who had confirmed the addition had become final, that the claim was made by the assessee under the head provisions, that the claim was not ascertained. He referred to the case of Param Jewells(P. )Ltd. (131 ITD ) and upheld the order of the AO. 4. Before us, the Authorised Representative (AR) stated that the assessee ha....
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....tation and understanding of a provision. It is said that so long as the assessee has not concealed any material fact or the factual information given by him has not been found to be incorrect, he will not be liable to imposition of penalty under section 271(1)(c) of the Act, even if the claim made by him is unsustainable in law, provided that he either substantiates the explanation offered by him or the explanation, even if not substantiated, is found to be bona fide. If the explanation is neither substantiated nor shown to be bona fide, Explanation 1 to section 271(1)(c) would come in to play and the assessee will be liable to for the prescribed penalty. Principles of taxation jurisprudence say that in order to justify the levy of penalty....
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....n the Act of automatic levy of penalty for the additions/disallowances made. So, we are of the opinion that there was no furnishing of inaccurate particulars and that the explanation given by the assessee was bonafide. Here, we would like to refer to the matter of Reliance Petroproducts Ltd. (322ITR158)where the Hon'ble Apex Court has held as under: A glance at the provisions of section 271(1)(c) of the Income-tax Act, 1961, suggests that in order to be covered by it, there has to be concealment of the particulars of the income of the assessee. Secondly, the assessee must have furnished inaccurate particulars of his income. The meaning of the word "particulars" used in section 271(1)(c) would embrace the details of the claim made. Where n....