TaxTMI 
TaxTMI 
2014 (7) TMI 1397
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....aintenance, office maintenance and rent expenses. During the year, the assessee company has also shown income of Rs. 18,24,619/- under the head income from "other sources". Out of this, Rs. 18,03,669/- was dividend income which was exempt from tax and Rs. 20,950/- was interest income which was taxable. The Assessing Officer disallowed whole of the expenditure of Rs. 6,81,101/- debited in the profit & loss account for the year by invoking provisions of Section 14A of the Income-tax Act, 1961. The CIT (A) sustained the addition. However, the ITAT in quantum appeal has held that expenses debited in the profit & loss account are in the nature of common expenses and therefore, liable to be proportionately allocated to both the types of income in....
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....u/s 271(1)(c) despite the fact that the issue of disallowance under section 14A has all along been a debatable controversial one and no penalty can be levied on such claim made by the appellant. 6. On the facts and circumstances of the case, the learned CIT (A) has erred both on facts and in law in confirming the above penalty despite the fact that the assessee has made full and true disclosure with all the facts and figures and as such there was no concealment of income on the part of the assessee. 7. On the facts and circumstances of the case, the learned CIT (A) has erred both on facts and in law in confirming penalty u/s 271(1)(c) as no finding has been given on merit regarding concealment in the order passed by the A.....
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....upreme Court in the case of Reliance Petroproducts Pvt.Ltd. - [2010] 322 ITR 158. She drew our attention to paragraph 9 to 12 of the judgment. She finally pleaded to delete the penalty. 4. On the other hand, learned DR relied on the order of the Assessing Officer. 5. We have heard both the sides on the issue. The assessee is a company which debited expenditure under the head legal & professional Rs. 1,05,979/-, vehicle running & maintenance Rs. 1,40,362/-, office maintenance Rs. 1,94,760/- and rent expenses Rs. 2,40,000/- totaling to Rs. 6,81,101/-. It is a fact that for maintaining a company, certain office and legal expenses are necessary. The Assessing Officer disallowed whole of the amount. CIT (A) also confirmed the disallowance.....
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....329, this Court explained the terms "concealment of income" and "furnishing inaccurate particulars". The Court went on to hold therein that in order to attract the penalty under section 271(1)(c), mens rea was necessary, as according to the Court, the word "inaccurate" signified a deliberate act or omission on behalf of the assessee. It went on to hold that Clause (iii) of section 271(1) provided for a discretionary jurisdiction upon the Assessing Authority, inasmuch as the amount of penalty could not be less than the amount of tax sought to be evaded by reason of such concealment of particulars of income, but it may not exceed three times thereof. It was pointed out that the term "inaccurate particulars" was not defined anywhere in the Act....
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....hy decision in Dilip N. Shroff's case (supra) was overruled by this Court in Dharamendra Textile Processors' case (supra), was that according to this Court the effect and difference between section 271(1)(c) and section 276C of the Act was lost sight of in case of Dilip N. Shroff (supra). However, it must be pointed out that in Dharamendra Textile Processors' case (supra), no fault was found with the reasoning in the decision in Dilip N. Shroff's case (supra), where the Court explained the meaning of the terms "conceal" and "inaccurate". It was only the ultimate inference in Dilip N. Shroff's case (supra) to the effect that mens rea was an essential ingredient for the penalty under section 271(1)(c) that the decision in Dilip N. Shroff's ca....
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....t the dividends from the shares did not form the part of the total income. It was, therefore, reiterated before us that the Assessing Officer had correctly reached the conclusion that since the assessee had claimed excessive deductions knowing that they are incorrect; it amounted to concealment of income. It was tried to be argued that the falsehood in accounts can take either of the two forms; (i) an item of receipt may be suppressed fraudulently; (ii) an item of expenditure may be falsely (or in an exaggerated amount) claimed, and both types attempt to reduce the taxable income and, therefore, both types amount to concealment of particulars of one's income as well as furnishing of inaccurate particulars of income. We do not agree, as the ....