TaxTMI 
TaxTMI 
2016 (9) TMI 246
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.... are that during the AY 2002-03 the assessee had received gifts amounting to Rs. 16 lakhs from three persons, whereas in AY 2003-04 the assessee had received gifts amounting to Rs. 10 lakhs from two persons. The assessee had filed affidavits, gift deeds, copies of ITRs, copies of Wealth Tax Returns, copies of bank accounts and copies of PAN for all the donors during the assessment proceedings. The assessee had shown these gifts in her capital accounts also. However, the AO added these amounts to the income of the assessee on the basis that the gifts have been received by the assessee from persons who were not relatives, that the transactions of the gifts were isolated in nature and that the assessee could not prove the genuineness of these ....
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.... the quantum proceedings the assessee had discharged her onus by providing copies of gift deeds, affidavits, copies of ITRs, copies of Wealth Tax Returns, copies of bank statements etc. and hence the initial burden regarding identity, genuineness and credit worthiness of the donors had been demonstrated. Further there was no concealment or furnishing of inaccurate particulars by the assessee and in view of the decision of the Hon'ble Apex Court in CIT vs. Reliance Petro Products Pvt. Ltd., 322 ITR 158 (SC) that mere making of a claim which is not sustainable in law by itself will not amount to furnish all inaccurate particulars, the penalty levied u/s 271(1) (c) was patently wrong and liable to be deleted. 4. The Ld. DR submitted that the ....
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.... the authorities have to consider the matter afresh from different angle. The statute requires a satisfaction on the part of the Assessing Officer: he is required to arrive at a satisfaction so as to show that there is primary evidence to establish that the assessee had concealed the amount or furnished inaccurate particulars and this onus is to be discharged by the Department. While considering whether the assessee has been able to discharge his burden the Assessing Officer should not begin with the presumption that he is guilty. Since the burden of proof in penalty proceedings varies from that in the assessment proceedings, a finding in the assessment proceedings that a particular receipt is income cannot automatically be adopted, though ....
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....t of income or furnishing inaccurate particulars of income. Further if there is any material or additional evidence which was not produced during assessment proceedings same can be produced in penalty proceedings as both assessment and penalty proceedings are distinct and separate. In CIT vs. M/s Sidhartha Enterprises (2009) 184 Taxman 460 (P & H)(HC) it was held that the judgment in Dharmendra Textile cannot be read as laying down that in every case where particulars of income are inaccurate, penalty must follow. Even so, the concept of penalty has not undergone change by virtue of the said judgment. Penalty is imposed only when there is some element of deliberate default. 6. At this juncture it may be apposite to refer to the decision of....
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....nd "particulars" in conjunction, they must mean the details supplied in the return, which are not accurate, not exact or correct, not according to truth or erroneous. The court noted that it was an admitted position that no information given in the return was found to be incorrect or inaccurate. It was not as if any statement made or any detail supplied was found to be factually incorrect and accordingly, held that, prima facie, the assessee could not be held guilty of furnishing inaccurate particulars. The court repelled the contention raised by the counsel for the revenue that "submitting an incorrect claim in law for the expenditure on interest would amount to giving inaccurate particulars of such income". The court held that in order to....
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....ngs but will not suffice in penalty proceedings. With regard to the provisions of section 271(1)(c ) of the Act pertaining to penalty, the Hon'ble Apex Court has authoritatively laid down that making of a claim by the assessee which is not sustainable will not tantamount to furnishing inaccurate particulars. In CIT vs. Reliance Petroproducts Pvt. Ltd. 322 ITR 158 (SC), the Hon'ble Apex Court has held as follows: "A glance at this provision would suggest that in order to be covered, there has to be concealment of particulars of the income of the assessee. Secondly, the assessee must have furnished inaccurate particulars of his income. The present is not a case of concealment of income. That is not the case of the Revenue either. However, th....