2017 (1) TMI 1321

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.... the I.T. Act." 2. Briefly stated the facts are that the case of the assessee was picked up for scrutiny and the assessment under section 143(3) of the Income Tax Act, 1961 (hereinafter referred to as the Act) was framed vide order dated 27.12.2011. While framing the assessment, the AO made disallowance of interest by observing that the assessee firm has given interest free loans to its partner for non business purposes and also initiated penalty proceedings under section 271(1)(c) of the Act. Subsequently, the AO imposed penalty of Rs. 3,50,610/- in respect of addition of Rs. 10,31,510/- confirmed by ld. CIT (A) in quantum proceedings. The assessee aggrieved by this order, filed an appeal before ld. CIT (A), who after considering the su....

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....s held that the words "inaccurate" and "particulars" in conjunction mean the details supplied in the return, which are not accurate, not exact or correct, not according to truth or erroneous. The ld. Counsel submitted that the judgment relied on by ld. CIT (A) is distinguishable on facts. He submitted that in that case the assessee had claimed loss on sale of plant & machinery in the Profit & Loss account which is a capital loss. He submitted that in that case the claim was contrary to the elementary and well known basic principles of accountancy. Therefore, under the peculiarity of those facts, the Hon'ble High Court confirmed the penalty. But in the present case, the facts are distinguishable as the assessee had disclosed all material fac....