TaxTMI 
TaxTMI 
2019 (9) TMI 1126
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.... levying penalty under section 271(1)(c) of the Act amounting to Rs. 54,73,884 on account of foreign exchange fluctuation loss of Rs. 1,68,68,672. 2) On the facts and in the circumstances of the case and in law, the learned CIT(A) erred in upholding the action of the learned AO and not appreciating the fact that the Appellant had neither concealed particulars of income nor furnished inaccurate particulars thereof. 3) On the facts and in the circumstances of the case and in law, the learned CIT(A) erred in not quashing the penalty as the notice under section 274 of the Act did not specifically mention, whether penalty is initiated for furnishing of inaccurate particulars of income or for concealment of income. 4) O....
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.... 37 of the Act. Assessee in response submitted that the assessee's books of account were audited as prescribed u/s. 44AB of the Act and the assessee has already submitted all the details. That the assessee had suo-motto submitted during the assessment proceedings foreign currency loss on account of capital assets of Rs. 1,68,68,672/- shall be disallowed for computation of tax as it does not pertain to revenue transaction. Further the assessee claimed that the same happened inadvertently and the same was also not reported by the tax auditor in Form 3CD. That at the time of filing of return the assessee has relied on the tax audit report of the Chartered Accountant. The assessee also stated that the Assessing Officer nowhere in the assessment....
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....turn could have been filled by the assessee as the Act gives adequate time for the same. 5. The Assessing Officer further referred to the decision of Hon'ble Apex Court in the case of Union of India Vs. Dharmendra Textiles Processors (166 Taxmann 65) and decision in the case of K.P. Madhusudanan Vs. CIT (251 ITR 99). The Assessing Officer further distinguished the decision relied upon by the assessee and finally concluded that he was satisfied that the assessee had furnished inaccurate particulars of its income and concealed its income in various issues discussed above. 6. Against the above order, the assessee has filed the appeal before learned CIT(A). However learned CIT(A) upheld the decision of the Assessing Officer. 7. Aga....
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....¢ Orbit Enterprises (ITA No. 1596 & 1597/Mum/2014) dated 1 September 2017 • Mrs Archana D. Talati (ITA No. 2696/Mum/2016) dated 5 June 201 9. He further referred to the following proposition :- Penalty proceedings invalid in case where prima facie satisfaction not recorded by the Assessing Officer at the time of initiation of penalty proceedings : • MWP Ltd (264 CTR 502) (Kar HC) • AMI Builders Pvt Ltd vs ACIT (46 CCH 334) (Mum ITAT) • ABR Auto Pvt Ltd vs ACIT (51 CCH 477) (Delhi ITAT) • Suvaprasanna Bhatacharya 175 TTJ 238 (Kol ITAT) • Shri Meghraj Kesaji Chaudhari vs ACIT (ITA No. 1296/Pun/2015) • DCIT vs Purti Sakhar Karkhana Ltd (15....
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....ion of honourable of apex court in the case of CIT Vs. S.V. Angidi Chettiar (XLIV ITR 739). Accordingly this issue raised is remitted to the file of learned CIT-A with directions as above. 12. Another ground raised is that penalty proceeding is invalid as satisfaction is not recorded by the assessing officer at the time of initiation of penalty. 13. In our considered opinion the assessee doesn't deserve to succeed on this ground. The assessing officer has after disallowance of the impugned amount duly noted in the assessment order that "penalty proceedings u/s. 271(1)(c) of the Act is initiated". Consequent to amendment in section 271 by insertion of section 271(1B) duly applicable in the extant assessment year, this is sufficient....
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....te that MBIPL has adopted a consistent approach while filing return of income for AY 2013-14 viz. treating the foreign exchange fluctuation loss on account of capital assets as revenue 'in nature and hence deductible against the business income basis the position adopted in AY 2012-13 viz. treating the foreign exchange fluctuation gain on capital assets as revenue in nature and offering the same to tax. The AO accepted the position of MBIPL for AY 2012-13 ie treating the same as revenue in nature, accordingly, it is submitted that principle of consistency should be applicable in the instant case". 17. Hence the assessee was very well aware that it was deliberately showing capital account transaction loss as loss on revenue account. H....