2016 (10) TMI 353

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....lowance of Rs. 8,83,883/- made under deeming provisions of section 94(7) of the Act. 3. Facts of the case are that the assessee filed his return of income on 30.9.2009 declaring total loss of Rs. 1,71,87,067/-. The case of the assessee was selected for scrutiny and the assessment was framed vide order dated 12.12.2011 passed under section 143(3) of the Act at a total loss of Rs. 1,60,54,886/- by making two disallowances. One of Rs. 8,83,883/- being dividend on mutual funds which was claimed as exempt u/s 10(35) of the Act by the assessee treating the same as deemed interest under deeming provisions of section 94(7) of the Act and second Rs. 1,78,227/- which relates to cost of acquisition of Birla Sunlife Income Plus. The penalty proceeding....

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.... term capital loss of Rs. 8,83,883/- in respect of Reliance Mutual Funds which was rejected by the AO during the course of assessment proceedings under the provisions of section 94(8) of the Act and correspondingly the income of the assessee went up. Perusal of these facts clearly reveals that the assessee has fully disclosed all the particulars of loss qua the said short term capital loss of Rs. 8,83,883/- from mutual fund in the return of income and thus has not furnished inaccurate particulars qua the said Short term loss. The ld. AR vehemently submitted that the penalty u/s 271(1)9c) of the Act was not imposable in respect of Rs. 8,83,883/- being short term capital loss on mutual funds, the full particulars of which stands disclosed in ....