TaxTMI 
TaxTMI 
TaxTMI 
2018 (11) TMI 691
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....(c) of the Act. The assessee submitted before the AO that it had neither furnished inaccurate particulars nor concealed particulars of its income as the advances given to the specified persons were duly mentioned in the Audit Report. Therefore, the penalty u/s 271(1)(c) of the Act was not leviable. The AO did not find merit in the submissions of the assessee and observed that as per Explanation (1) to Section 271(1)(c) of the Act, there is a presumption that the amount added or disallowed in computing the total income, shall be deemed to be the income in respect of which particulars had been concealed or inaccurate particulars had been filed. He also observed that the assessee's case was covered within the scope of furnishing inaccurate particulars of its income and thereby concealment of taxable income u/s 271(1)(c) of the Act. He accordingly, levied the penalty of Rs. 68,598/-. 4. Being aggrieved the assessee carried the matter to the ld. CIT(A) and submitted as under: "The levy of penalty u/s 271(1)(c) in the present case hinges on the facts/inference whether the assessee is guilty of furnishing inaccurate particulars in its return of income leading to the addition to the inc....
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....f income and that the advances given to the specified persons were duly mentioned in its Audit Report and that the details of loans and advances given to specified persons had been mentioned in Annexure II of the Audit Report. It was also submitted that the Auditor of the assessee trust inadvertently while computing the income failed to charge interest on the loans and advances to the specified persons as per the provisions of Section 164(2) of the Act, although accurate particulars in this regard had been shown by the assessee and its auditors in the return of income as well as Audit Report which clearly revealed that no deliberate attempt was made to conceal any particulars but it was only a mere omission from the return, of an item of receipt which neither amounts to concealment nor furnishing of inaccurate particulars of income unless and until there was some evidence to show or some circumstances ground from which it could be concluded that 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 thereon and hence the provisions of Section 271(1)(c) of the Act would not come into play....
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....d the submissions made before the authorities below and submitted that the addition was made by invoking the deeming provisions only but nothing was concealed. It was further submitted that the assessee was disclosing the advances given to the specified persons u/s 13(3) of the Act and there was no intention to conceal the particulars. A reference was made to page no. 15 of the assessee's paper book which is the copy of the Audit Report u/s 12A(b) of the Act, in Form No. 10B wherein it has clearly been mentioned that a sum of Rs. 16,50,000/- had been advanced to the relatives of one of the Managing Trustees Mr. Divya Bhushan Lal and Rs. 2,00,000/- was paid to M/s Albega Biological Pvt. Ltd., those figures were also mentioned in Annexure F to the Audit Report. A reference was made to page no. 12 of the assessee's paper book which is the detail of loan & advances and sundry creditors. It was contended that nondisclosure of income was a mistake of the counsel for the assessee but there was no mala vide intention, therefore, the penalty u/s 271(1)(c) of the Act was not leviable. The reliance was placed on the decision of the various Courts which were also quoted before the ld. CIT(A) a....
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.... 10. On a similar issue, the Hon'ble Apex Court in the case of CIT Vs Pricewaterhouse Coopers Pvt. Ltd. (supra) held as under: "18. The fact that the Tax Audit Report was filed along with the return and that it unequivocally stated that the provision for payment was not allowable under section 40A(7) of the Act indicates that the assessee made a computation error in its return of income. Apart from the fact that the assessee did not notice the error, it was not even noticed even by the Assessing Officer who framed the assessment order. In that sense, even the Assessing Officer seems to have made a mistake in overlooking the contents of the Tax Audit Report. 19. The contents of the Tax Audit Report suggest that there is no question of the assessee concealing its income. There is also not question of the assessee furnishing any inaccurate particulars. It appears to us that all that has happened in the present case is that through a bona fide and inadvertent error, the assessee while submitting its return, failed to add the provision for gratuity to its total income. This can only be described as a human error which we are all prone to make. The caliber and expertise of the asses....