TaxTMI 
TaxTMI 
2017 (4) TMI 53
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....IT Act, 1961 amounting to Rs. 10,17,007/- by the ITO, Ward 3(1), Jaipur. 2. That the penalty so confirmed is bad in law as well as on facts. 3. That the petitioner craves to add, alter or amend all or any of the grounds of appeal on or before the date of hearing." 2. Briefly stated the facts are that the case of the assessee was picked up for scrutiny assessment and the assessment under section 143(3) of the Income Tax Act, 1961 (hereinafter referred to as the Act). The Assessing Officer made addition of Rs. 43,90,008/- on account of long term capital gain and also initiated penalty proceedings u/s 271(1)(c) of the Act. Subsequently, the Assessing Officer levied a penalty on this addition of Rs. 10,17,007/- by order dat....
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....ubmitted that, that the penalty proceedings and quantum proceedings are two different and distinct proceedings. He submitted merely because the explanation found to be not acceptable would not be a basis for initiating the penalty. He placed reliance on the judgment of the Hon'ble Supreme Court in the case of CIT Vs. Reliance Patroproduct PVT.LTD. 322 ITR 158 (SC). 3.1. On the contrary, ld. Departmental Representatives opposed the submissions. 3.2. We have heard the rival contentions, perused the material available on record and gone through the orders of the authorities below. There is no dispute with regard to the fact that the assessee had placed all materials before the Assessing Officer. Therefore, it cannot be inferred that the ....
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....s stated above, what emerges is as under: (a) Penalty under section 271(1)(c) is a civil liability. (b) Mens rea is not an essential element for imposing penalty for breach of civil obligation or liabilities. (c) Willful concealment is not an essential ingredient for attracting civil liability. (d) Existence of conditions stipulated in section 271(1)(c) is a sine qua non for initiation of penalty proceedings under section 271. (e) The existence of such conditions should be discernible from the assessment order or the appellate authority or the revisional authority. (f) Even if there is no specific finding regarding the existence of the conditions mentioned in section 271(1)(c), at least ....
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....bona fide, an order imposing penalty could be passed (m) If the explanation offered, even though not substantiated by the assessee, but is found to be bona fide and al facts relating to the same and material to the computation of his total income have been disclosed by him, no penalty could be imposed. (N) The direction referred to in Explanation 1(B) to section 271 o the Act should be clear and without any ambiguity. (O) If the Assessing Officer has not recorded any satisfaction or ha not isud any direction to imitate penalty proceedings, in appeal, if the appellate authority records satisfaction, then the penalty proceedings have to be initiated by the appellate authority and not the assessing authority. ....
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....d all the materials before the authorities below and the law is well settled that penalty proceedings and quantum proceedings are two different and distinct proceedings. The claim of the assessee was reiterated on the ground that in quantum the assessee has claimed short-term capital loss on account of sale of shares. The transaction was doubted, being not genuine by the Assessing Officer. The Hon'ble Supreme Court in the case of M/s Reliance Patroproducts Pvt. Ltd.(Supra) has held as under:- "It was tried to be suggested that section 14A of the Act specifically excluded the deductions in respect of the expenditure incurred by the assessee in relation to income which does not form part of the total income under the Act. It was furt....