TaxTMI 
TaxTMI 
2015 (8) TMI 1485
X X X X Extracts X X X X
X X X X Extracts X X X X
..... CIT(A) is justified in deleting the penalty levied u/s 271(1)(c) of the Act, by holding that the assessee had declared all the material facts of borrowing in its balance sheet, without appreciating the fact that the true particulars of income were not furnished by the assessee in its return. . 3. Whether on facts and circumstances the Ld. CIT(A) is justified in deleting the penalty levied u/s 271(1)(c) of the Act, when the assessee, being a corporate entity having access to expert advice should have included the deemed income in its ITR as the provisions of section 2(22)(e) are very clear in this regard and by not doing so the assessee has furnished inaccurate particulars of its income. 4. Whether on facts and circumstan....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ed under section 271(1)(c) of the Act on this addition. In the penalty proceedings the assesse argued that there was no concealment of income.The assesse further stated that since it was not a registered shareholder or beneficial shareholder in M/s Preet Remedies Pvt. Ltd. the deemed dividend could not be assessed in its hands. The AO ,in his penalty order, held that the assesse had not given a convincing and plausible reason in support of its contention that there was no concealment of income. Interpreting the provisions of section 2(22)(e) he held that dividend includes any payment by a company ,not being a company in which the public are substantially interested,by way of loan or advance to any concern in which a shareholder of the compa....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... Ltd. the deemed dividend could not be assessed in its hands.The AR placed reliance on the judgement of the ITAT Mumbai Bench in the case of ACIT vs V. Bhaumik Colour (P) ltd.313 ITR 146 (Mum)(SB) in this regard.The AR further argued that since the addition made was solely on account of difference of view taken on the same set of facts,it had nothing to do with the concealment of income or furnishing of inaccurate particulars of income.The AR argued that the addition to income was made under the deeming provisions of the Act and as such penalty was not leviable as held by the ITAT Mumbai G Bench in the case of Rajesh L Durgani vs ACIT -Circle 18(3) Mumbai .Relying upon the decision of the Apex court in Reliance Petro products the AR argued ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....nable to substantiate an explanation ,then the addition or disallowance made to his total income as a result thereof shall be treated as income whose particulars have been concealed. 13. In the present case it is evident that the assesse has made full disclosure of the advance of Rs. 13 lacs received from M/s Preet Remedies Pvt. Ltd. The same has been duly disclosed in the balance sheet of the assesse ,as has been stated by the CIT(A) at para -5 of his order wherein he states ; "The fact of loan taken by the appellant company from M/s Preet Remedies (P) Ltd. came to the knowledge of the assessing officer from the balance sheet filed by the appellant" It has now to be seen whether the assesse has displaced the presumption rais....
X X X X Extracts X X X X
X X X X Extracts X X X X
....xplanation of the assesse that he had no intention to either conceal or furnish inaccurate particulars of income is quite probable and true in the state of law set out above. The assesse has ,therefore, discharged his onus of proof under Explanation 1 to section 271(1)(c) of the Act and shown that there was no willful or gross neglect on his part in returning the correct income.We are also satisfied that the assesse had disclosed all relevant particulars relating to his income and there was neither any concealment of income nor furnishing of inaccurate particulars of income. Addition made applying deeming provisions would not disclose it to be a case of filing inaccurate particulars of income. 14. In any case ,without prejudice to what h....