AI Drafter 
TaxTMI 
TaxTMI 
2017 (12) TMI 1413
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....n these appeals reads as under : "1. On the facts and in the circumstances of the case, the Ld. CIT(A) has erred in allowing the appeal of the assessee by ignoring the fact that assessee has furnished inaccurate particulars of income by claiming exemption u/s 11 of the Act in respect of business which was not incidental to the objects of the trust." At the first instance, we will deal with the appeal in ITA no. 3281.Del.2016 for the assessment year 1992-93. 3. The grievance of the Department in this appeal relates to the deletion of penalty levied by the AO u/s 271 (1) (c) of the Income Tax Act, 1961 (hereinafter referred to as the Act). Facts of the case, in brief, are that the assessee filed the return of income on 30.10.19....
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.... was no nexus between the Katha business and the objects of the assessee Trust which could constitute the carrying on of the Katha business an activity incidental to the attainment of the objects. The AO held that the assessee furnished inaccurate particulars of income by claiming exemption u/s 11 of the Act in respect of the business which was not incidental to the objects of the assessee trust and the said mistake could not have been said to be bona fide one. Accordingly penalty u/s 271(1)(c) of the Act was levied for Rs. 36,14,670/-. 7. Being aggrieved the assessee carried the matter to the ld. CIT(A) and submitted that there was neither any concealment of income nor furnishing of inaccurate particulars of income by the assessee and t....
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.... income on its part and it was purely a case of difference of opinion with regard to a debatable matter which could not be treated as concealment. The reliance was placed on the judgment of the Hon'ble Supreme Court in the case of CIT vs. Reliance Petro Products reported at 322 ITR 158. 8. The ld. CIT(A) after considering the submissions of the assessee observed that the AO had imposed the penalty mainly on the point of the mistake on the part of the assessee which could not be said to be bona fide one, the inaccurate particulars had been furnished by claiming exemption u/s 11 in respect of business which was not accidental to the objects of the assessee trust and that the assessee could not have been routinely careless while submitting ....
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....epartment is in appeal. 9. The ld. DR strongly supported the penalty order passed by the AO and further submitted that since the claim of the assessee u/s 11 of the Act was not allowable in view of the judgment of the Hon'ble Jurisdictional High Court. Therefore, the assessee concealed the income by making a false claim as such the AO was justified in levying the penalty u/s 271(1)(c) of the Act. 10. In his rival submissions, the ld. Counsel for the assessee reiterated the submissions made before the authorities below and repeated the observations made by the Ld. CIT(A) in the impugned order. Reliance was placed on the following case laws :- "1. CIT vs. Reliance Petro Products P.Ltd. (2010) 322 ITR 158(SC) 2. CIT vs. La....
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....rmation given in the return is found to be incorrect or inaccurate, the assessee cannot be held guilty of furnishing inaccurate particulars. In order to expose the assessee to penalty, unless the case is strictly covered by the provision, the penalty provision cannot be invoked. By no stretch of imagination can making an incorrect claim tantamount to furnishing inaccurate particulars. There can be no dispute that everything would depend upon the return filed by the assessee, because that is the only document where the assessee can furnish the particulars of his income. When such particulars are found to be inaccurate, the liability would arise. To attract penalty, the details supplied in the return must not be accurate, not exact or correct....