TaxTMI 
TaxTMI 
2018 (2) TMI 1140
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.... 1961. 2. The assessee in the present case is a partnership firm of practising Chartered Accountants. The return of income for the year under consideration was filed by it on 28.09.2009 declaring total income of Rs. 6,35,470/-. In the Profit & Loss Account filed along with the said return, a sum of Rs. 5,19,238/- was debited by the assessee on account of audit expenses. On verification of the said expenses, it was found by the Assessing Officer that the said expenses were incurred by the assessee on account of travelling and conveyance of its Audit Staff and Audit Clerks. According to the Assessing Officer, the said expenses were liable to be taken into account while calculating the value of Fringe Benefit and since it was not done by the ....
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....der section 271(1)(d) was challenged by the assessee in the appeal filed before the ld. CIT(Appeals). During the course of appellate proceedings before the ld. CIT(Appeals), the following submission was filed by the assessee in writing in support of its case on the issue:- "For that the Ld. ITO ignored the fact that concerned audit expenses which were fully disclosed in the profit & loss account without furnishing of inaccurate particulars, in imposing penalty u/s.271)1)(d). Thus levying penalty u/s. 271(1)(d) on Audit Expenses on the grounds of furnishing of inaccurate particulars and concealment of FBT is against the spirit of law & unjustified. For that the matter in the Ld. I.T.O's order was one pertaining to point of law where th....
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....at the omission was attributable to an intention or desire on the part of the assessee to hide or conceal the income so as to avoid the imposition of tax there on, in order that a penalty under section 271(1)(iii) may be imposed, if has to be proved that the assessee consciously made the concealment or furnished inaccurate particulars of his income. Further the Income Tax Appellate Tribunal Delhi Bench 'C', New Delhi in the case of Hindustan Coca-Cola Marketing Company Private Ltd, Vs. Dy. Commissioner of Income Tax, Circle-12(1), New Delhi held that, "In view of the above facts, provisions of law and the above decision of apex court, we respectfully submit that captioned proceedings u1s.271(1)(d) of the Act be dropped as the add....
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....levy of the penalty which is deleted". In the light of the aforesaid judgments the appellant begs to state that there is no furnishing of inaccurate particulars or concealing FBT in question and the appellant himself has accepted the levy of FBT on Audit Expenses by the Ld. ITO to avoid any further litigation considering the fact that on the point of law, there could be two different opinions. The appellant has shown its bona fide on the count that, appellant aid the tax levied and did not carry out the issue in further litigation. Under facts and circumstances as stated above, the penalty levied by the Ld. AO is unjustified. 4. The above submission filed by the assessee was not found acceptable by the ld. CIT(Appeals) and he procee....
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....re the Tribunal. 5. We have heard the arguments of both the sides and also perused the relevant material available on record. It is observed that the audit expenses of Rs. 5,19,238/- were claimed to be incurred by the assessee company towards travelling and conveyance of the Articled Clerks, who were C.A. students receiving training from the assessee-firm. It was contended by the assessee during the course of assessment proceedings as well as during the course of penalty proceedings that there being no employer-employee relationship between the assessee-firm and the Articled Clerks, the audit expenses did not fall under the ambit of FBT. Although this claim of the assessee was not accepted by the Assessing Officer on the ground that it was....