2018 (7) TMI 832

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....aiming a set off of business loss of Rs. 7,91,016/- and depreciation of Rs. 1,30,141/- for the A.Y.2010-11 against the business income. Depreciation pertaining to A.Y.2010-11 of Rs. 2,48,755/- was also claimed as set off against the income from other sources for the assessment year under consideration. During the course of scrutiny proceedings, it was found that as per return of income filed by assessee for the A.Y. 2010-11, there was no loss either under the head Business Income or depreciation to be brought forward and carried forward to be claimed as set off from income. When the same was pointed out by AO, assessee accepted the mistake and accepted for disallowance of set off of loss/depreciation claimed in the return of income filed fo....

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.... loss claimed for set off was not eligible to be set off and carry forward. The revised computation was also filed on the last day of finalisation of scrutiny assessment only after the wrong claim was pointed by AO. AO held that it was the responsibility of assessee and his AR to verify the return of income before filing it. Therefore, according to AO, assessee with a wilful intention to misguide the assessment proceeding had claimed set off of false brought forward losses and depreciation and had thereby furnished inaccurate particulars. AO found it to be a fit case for imposition of penalty and levied a minimum penalty of Rs. 2,97,476/- u/s. 271(1)(c) of the Act. 3. In appeal before Ld. CIT(A), assessee reiterated the submissions made ....

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....come for A.Y. 2011-12. It is not understood how the loss/depreciation could be shown in the statement of A.Y. 2011-12, if it was actually not there for A. Y. 2010-11. Moreover, even that was assessee's own statement and one false statement cannot constitute a reasonable explanation for another false statement. If the ratio of the decisions in the cases of Reliance Petro Products and Taher Ali (supra) were to be applied in the fashion described by the assessee, it would amount to giving a license to everyone to make a false claim and, when caught to withdraw the same. Thus, the provision of penalty u/s. 271(1)(c) of the Act would be rendered illusory. It is held that the assessee made a false claim of brought forward loss and unabsorbed ....