TaxTMI 
TaxTMI 
2012 (12) TMI 1179
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....f the Income Tax Act, 1961 by the ld. Commissioner of Income Tax (Appeals)-II. Ludhiana is against law and facts on the file in as much he was not justified to arbitrarily uphold levy of penalty u/s 271(1)(c) at ₹ 11,00,000/- by the Ld. Assessing Officer whereas no such penalty was exigible in the facts and circumstances of the case." 3. The only issue raised in the present appeal is against levy of penalty u/s 271(1)(c) of the Act amounting to ₹ 11 lacs. 4. The brief facts of the case are that during the year under consideration survey operations under section 133A of the Act were conducted at the business premises of the assessee on 8.2.2006. The assessee during the course of survey offered and thereafter declared addition....
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....as leviable in cases where there was difference of opinion, was not accepted by he Assessing Officer, as according to him, there were no two views possible on this issue. The Assessing Officer further noted that the assessee had nowhere contested the head under which the surrendered income had been assessed and in any case, the surrender being on account of unexplained cash and unexplained investment, could not be treated as business income. Further the claim of deduction under section 80IB of the Act on which surrendered income was not allowable in view of the ratio laid down in National Leggured Works (supra). The assessee was held to have furnished inaccurate particulars of income and thus liable for levy of penalty u/s 271(1)(c) of the ....
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....authorities below further placed reliance on the decision of the Delhi Bench of the Tribunal in Chadha Sugars Pvt. Ltd. Vs. ACIT [135 ITD 42 (Del). 7. The learned A.R. for the assessee further placed reliance on the order of the Chandigarh Bench of the Tribunal in Arisudana Spinning Mills Ltd. in ITA Nos.609 to 611/Chd/2008 relating to assessment years 1997-98, 1998-99 and 2000-01, order dated 28.11.2008 reported in (2009) [129 DTR (Chd)(Trib)] 1. The learned A.R. for the assessee further pointed out that the said decision has been upheld by the Hon'ble Punjab & Haryana High Court in CIT Vs. Arisudana Spinning Mills Ltd. [326 ITR 429 (P&H)]. 8. We have heard the rival contentions and perused the record. IN the facts of the present c....
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.... section 80IB of the Act on the surrendered income and consequently penalty u/s 271(1)(c) of the Act at ₹ 11 lacs was levied. The plea of the assessee before us was that it had furnished complete particulates of its income in the return of income filed for the captioned assessment year and mere recomputation of deduction under section 80IB of the Act could not held the assessee to have furnished inaccurate particulars of income. 10. From the perusal of the record we find that the assessee had declared ₹ 11 lacs on account of unexplained investment in the construction of factory building, ₹ 9 lacs on account of unexplained cash and ₹ 80 lacs on account of unexplained expenditure incurred/investment made in stock. Th....
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....oncealing the income or furnishing of inaccurate particulars are to be satisfied, before levy of penalty u/s 271(1)(c) of the Act. Merely because it had made the claim of deduction under section 80IB of the Act, which in turn was certified by the Chartered Accountant, does not absolve the assessee and hence the assessee is exigible to levy of penalty u/s 271(1)(c) of the Act. The denial of deduction under section 80IB of the Act on such surrendered income has been made by the authorities below by applying the ratio laid down by the Jurisdictional High Court in National Leggured Works (supra) wherein it was held that the assessee could not be held to be entitled to claim of deduction under section 80HHC of the Act on incomes surrendered as a....
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....not acting bonafide while making a claim of this nature, that would give a license to unscrupulous assessees to make wholly untenable and unsustainable claims without there being any basis for making them, in the hope that their return would not be picked up for scrutiny and they would be assessed on the basis of self Assessment under Section 143(1) of the Act and even if their case is selected for scrutiny, they can get away merely by paying the tax, which in any case, was payable by them. The consequence would be that the persons, who make claims of this nature, actuated by a malafide intention to evade tax otherwise payable by them would get away without paying the tax legally payable by them, if their cases are not picked up for scrutin....