TaxTMI 
TaxTMI 
TaxTMI 
2019 (1) TMI 91
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....idi, the Ld. Departmental Representative, submitted that during the course of assessment proceeding, the Assessing Officer disallowed Rs. 1,66,96,393/- towards insurance receipts and Rs. 90,86,349/- towards business expenditure. According to the Ld. D.R., the Assessing Officer also made disallowance under Section 14A of the Income-tax Act, 1961 (in short 'the Act') to the extent of Rs. 5,34,393/- and prepaid expenditure of Rs. 1,98,990/-. The Assessing Officer also disallowed interest on the delayed payment of TDS to the extent of Rs. 11,687/- and capital gain to the extent of Rs. 47,07,30,598/-. The Assessing Officer found that the assessee surrendered his Life Insurance Policy on 31.01.2009 and received a sum of Rs. 3,26,73,685/-. According to the Ld. D.R., the assessee in fact, took the policy on 20.04.2005 for Rs. 2 Crores and paid a premium of Rs. 1,26,73,685/- on the same day. Therefore, according to the Ld. D.R., the Assessing Officer found that the excess amount received over and above the premium of Rs. 1,26,73,685/- has to be treated as income. According to the Ld. D.R., the assessee has also availed pension plus regular policy during the assessment year 2009-10.....
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....ing the claim of the assessee. The assessee has furnished the entire details with regard to insurance receipt, expenditure claim, dividend income, prepaid expenditure and short term capital gain. The Assessing Officer without appreciating the facts, made additions in the assessment proceeding. According to the Ld. counsel, penalty proceeding is different from assessment proceeding. All the additions / disallowances cannot automatically result in levy of penalty. According to the Ld. counsel, the entire transactions were placed before the Assessing Officer and the Assessing Officer after considering the claim of the assessee found that certain claims are not allowable. It does not mean that the assessee has furnished inaccurate particulars of his income or concealed part of his income. Placing reliance on the judgment of Apex Court in CIT Vs. Reliance Petroproducts (P) Ltd. (2010) 322 ITR 158, the Ld.counsel submitted that mere claim cannot be construed as concealment of income or furnishing of inaccurate particulars of income. Having furnished all the particulars, according to the Ld. counsel, the assessee made claim bonafidely as per the provisions of Incometax Act, therefore, th....
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....f income. Moreover, the interest on delayed payment of TDS was placed before the Assessing Officer and the assessee claimed deduction. It does not mean that the assessee has concealed particulars of income. Similarly, details of prepaid expenses of Rs. 1,98,990/- were also available before the Assessing Officer. 9. Coming to the short term capital gain, the assessee retired from partnership firm with effect from 19.08.2008 and received a lump sum compensation from partnership firm over and above the capital contribution by way of immovable property. This was considered to be a short term capital gain. The fact remains that the assessee retired from partnership firm and received a lump sum compensation from the firm. This was disclosed before the Assessing Officer. Therefore, there is no question of any concealment of income or furnishing inaccurate particulars of income. In those circumstances, this Tribunal is of the considered opinion that the judgment of Apex Court in Reliance Petroproducts (P) Ltd. (supra) is squarely applicable to the facts of the case. Therefore, the CIT(Appeals) has rightly deleted the disallowance made by the Assessing Officer. Hence, this Tribunal do n....
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....m of expenditure, according to the Ld. counsel, that will not amount to admission for disallowance, therefore, the CIT(Appeals) has rightly deleted the penalty levied by the Assessing Officer. 14. We have considered the rival submissions on either side and perused the relevant material available on record. It is not in dispute that the assessee has claimed an expenditure of Rs. 2,88,22,870/-., which includes a sum of Rs. 30,00,000/- said to be paid by one Shri Nagarajan to Shri Ramesh Krishan on so-called instruction of the assessee. The fact remains that the assessee has furnished entire details of income and also furnished entire details of the so-called expenditure. The Assessing Officer found that the assessee has not substantiated the claim of expenditure. The question arises for consideration is when the assessee claimed expenditure and the Assessing Officer disallowed the claim of the assessee on the ground that such a claim was not substantiated, whether there was any concealment of income or furnishing inaccurate particulars of income? This issue was considered by the Apex Court in the case of Reliance Petroproducts (P) Ltd. (supra). The Apex Court found that mere claim ....
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....closed income. Hence, the provisions of Section 271AAB of the Act is not applicable at all. Therefore, according to the Ld. counsel, the CIT(Appeals) has rightly deleted the penalty levied by the Assessing Officer. 19. We have considered the rival submissions on either side and perused the relevant material available on record. Admittedly, there was search operation in the premises of the assessee on 13.01.2015. In the course of search operation, the assessee offered an additional income of Rs. 50 Crores under the head "Income from Other Sources". The Assessing Officer levied penalty under Section 271AAB of the Act in respect of the additional income offered by the assessee. It is not the case of the Revenue that any incriminating material was found during the course of search operation with regard to income offered by the assessee. The term "undisclosed income" is not defined in Section 271AAB of the Act, but it is defined in Section 158B(b) of the Act. Section 158B(b) of the Act reads as follows:- "158B(b) "undisclosed income" includes any money, bullion, jewellery or other valuable article or thing or any income based on any entry in the books of account or other documents o....