TaxTMI 
TaxTMI 
2017 (5) TMI 16
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.... u/s.271(1)(c) of the Income Tax Act, 1961, in short 'the Act'. 2. We come to the relevant facts. This assessee filed his return on 29.03.2012 stating income of Rs. 10,04,760/-. The same was summarily processed. The Assessing Officer issued scrutiny notices thereafter. We notice from para 5 of assessment order dated 16.03.2014 that he issued Section 142(1) notice dated 08.10.2013 specifically asking the assessee if he had omitted to have included any income in the abovestated return. The assessee appears to have filed his written submission dated 12.02.2014 submitting to have offered all his income taxable in the impugned assessment year. That was not to be the case. The Assessing Officer then quoted departmental information indicating t....
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....The assessee pleaded to be a senior citizen. He explained that the thought of declaring the above long term capital gains skipped his mind as the sale consideration had not been received in the impugned assessment year. He therefore claimed the same to be a bonafide error wherein he deliberately offered the above capital gains for taxation. The Assessing Officer however quoted all the above quantum developments to treat assessee's act and conduct as that of furnishing of inaccurate particulars of income as well as concealment of income to impose the impugned penalty of Rs. 3,06,548/-. 5. The CIT(A) upholds Assessing Officer's action as under: "5.3 I have considered the facts and the circumstances of the case, the observations of the A....
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....t obligatorily be imposed in this case in view of CIT vs Lal Chand Tirath Ram, 225 ITR 675 (Punj), where it was held by Hon'ble High Court that mere offering of an explanation would not absolve the assessee from the liability of penalty. It is necessary for the assessee to (i) offer an explanation and (ii) substantiate it. Furthermore, in CIT vs Geo Sea Foods, 244 ITR 44 (Ker), it has been held that the explanation of the assessee must be an acceptable explanation and if he fails to discharge the burden, the presumption of explanation 1 will be available to the assessing Officer. In view of the above discussion, it is clear that Explanation 1 to section 271(1)(c) is attracted in this case and the appellant is liable for penalty u/s 271(....
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....tion, remedial and coercive in nature and is far different from penalty for a crime. In this kind of penalty, element of mens rea is not required. In Union of India vs Dharmendra Textile Processors [2008] 166 Taxman 65 (SC), Hon'ble Supreme Court reiterated this position and held that penalty u/s 271(1)(c) is a civil liability and for attracting such civil liability, willful concealment is not an essential ingredient as is case in the matter of prosecution u/s 276C. 5.6 In this case, the assessee has not surrendered the LTCG of Rs. 67,87,271/- voluntarily. However, even if it was voluntary, the same would not have protected the assessee from the consequences of section 271(1)(c), in view of the decision of Hon'ble Supreme Court i....
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.... recognize those types of defences under the explanation 1 to Section 271(1)(c) of the Act. It is trite law that the voluntary disclosure does not release the Appellantassessee from the mischief of penal proceedings. The law does not provide that when an assessee makes a voluntary disclosure of his concealed income, he had to be absolved from penalty. 9. We are of the view that the surrender of income in this case is not voluntary in the sense that the offer of surrender was made in view of detection made by the AO in the search conducted in the sister concern of the assessee. In that situation, it cannot be said that the surrender of income was voluntary. AO during the course of assessment proceedings has noticed that certain docu....
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....'ble ITAT, Delhi Bench has in the case of Sanjay Enterprises (P.) Ltd. vs ITO, [2012] 17 taxmann.com 94 (Delhi), has held that if an assessee surrenders any income after department has collected incriminating material with regard to such income, it cannot be called a voluntary surrender for purpose of section 271(1)(c) of the Act. In view of above discussion and considering the fact that the assessee had come out to surrender LTCG of Rs. 19,39,327/- during assessment proceedings only after its detection by the Assessing Officer, it cannot be said to be voluntary surrender. In view of the above discussion, it is clear that Explanation 1 to section 271(1)(c) is attracted in this case and the appellant is liable for penalty u/s 271(1)(c) s....