TaxTMI 
TaxTMI 
2025 (3) TMI 1686
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....s. 6,53,800/- a. The Ld. CIT(A) has erred in confirming the penalty u/s 271(1)(c), assuming that appellant has concealed income which is contrary to the fact; given that the Appellant has always been regular in filing his ITR in time year-after-year, but could not file the same for the AY in question in view of his extensive travel in relation to his employment and also on account of bonafide belief that since TDS was duly deducted from all his incomes (Salary and Bank interest), there is no tax default on his part. b. The Ld. CIT(A) has erred in fact and in law by charging a penalty of Rs. 6,53,800 u/s 271(1)(c) without appreciating that the alleged concealed income (if any), in respect of bank interest being Rs. 2,08,451 only, the penalty chargeable (if any) should have been restricted to Rs. 2,08,451 only and not Rs. 6,53,800 which figure is inclusive of interest of Rs. 4,45,349 u/s 234A, 234B and 234C. 3. Ground no.1 is general and does not require any adjudication. Moreover, the ld.CIT(A) has accorded adequate opportunity of hearing and even reduced the quantum of penalty substantially. Therefore, the assessee should not have grievance any further. 4. A....
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....default on his part. It was noticed by the ld.CIT(A) that the taxes to the extent of Rs. 6,53,800/- would have escaped assessment, if the case had not been taken up for re-assessment proceedings. Therefore, he was of the opinion that the assessee had not furnished any valid justification for his failure to file return and thus concealment penalty to the extent of Rs. 6,53,800/- levied by the AO was found justified in view of Explanation-3 to section 271 of the Act and therefore, out of total penalty of Rs. 44,03,865/-, concealment penalty to the extent of Rs. 6,53,800/- was upheld and the appellant got relief of Rs. 37,50,065/-. 5. Before us, while the ld.DR relied on the orders of authorities below, the ld.Authorised Representative argued in support of the grounds of appeal and claimed that there was reasonable cause for non filing of the return on part of the assessee. Moreover, major part of the taxes were already paid by way of TDS on salary and Bank interest u/s 192 and 194A of the Act which were also reflected in 26AS. Therefore, there was no intention to evade tax. Moreover, tax sought to be evaded was merely Rs 2,08,451/- after excluding interest u/s 234A/234B and 234C. ....
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....shows that the assessee was a non-filer. We agree with the observations of the ld.CIT(A) that had the AO not issued notice u/s. 148, it could be reasonably assumed that the assessee would not have come clean. Therefore, it is a clear case of concealment of income as per Explanation 3 to section 271(1)(c) of the Act. 5.3 In this regard, it is worthwhile to place reliance on a recent decision of the co-ordinate Bench of ITAT, Mumbai in the case of Pumpkin Pictures Private Limited ITA No.4197/Mum./2024 dated 17.12.2024 where on almost identical facts, penalty u/s 271(1)(c) r.w. Explanation 3 was upheld. Relevant paras of the order are reproduced below: "9. Before dealing with the aforesaid contentions on behalf of the assessee, it is relevant to note the provisions of section 271(1)(c) of the Act, which provides that if the assessing officer in the course of proceedings under this Act is satisfied that any person has concealed the particulars of his income or furnished inaccurate particulars of his income, he may direct such person shall pay by way of penalty a sum which is not less than but which shall not exceed three times the amount of tax sought to be evaded. We find ....
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....eceived from the ITD systems and NMS portal was satisfied that the assessee has received substantial contract receipts amounting to Rs. 2.5 crore, during the year under consideration. Therefore, on a plain application of the provisions of Explanation 3 to section 271(1)(c) of the Act, the present case clearly falls in the category of "concealment of particulars of income" for the purpose of section 271(1)(c) of the Act. 12. Such being the facts, we find merits in the findings of the learned CIT(A), as noted in the foregoing paragraph, in rejecting the contention of the assessee that no penalty can be levied in the present case as the addition has been made purely on an estimated basis. As evident from the record, the assessee has been in complete defiance of various statutory requirements and also did not furnish the details as called for during the assessment proceedings. Thus, when necessary data, at least the income tax return, has not been filed by the assessee, despite opportunity even pursuant to notice issued under section 148 of the Act, the assessee cannot now take the plea that since the addition has been made by applying the net profit rate, no penalty can be le....
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.... the light of aforesaid discussions and the provisions of the Act in this regard, we hold that on the facts and in the circumstances of the case, penalty u/s 271(1)(c) was rightly levied by the AO and sustained by the ld.CIT(A). Ground no. 2(a) is, therefore, dismissed. 6. In the ground no.2(b) above, the assessee has contested the quantification of penalty stating that the Ld. CIT(A) erred in fact and in law by charging a penalty of Rs. 6,53,800/- u/s 271(1)(c) without appreciating that the alleged concealed income in respect of bank interest being Rs. 2,08,451/- only, the penalty chargeable should have been restricted to Rs. 2,08,451/- only and not Rs. 6,53,800/- which figure is inclusive of interest of Rs. 4,45,349/- u/s 234A, 234B and 234C. 6.1 On careful consideration of the contentions, we find that in the case under consideration, penalty for concealment u/s 271(1)(c) has been imposed in terms of Explanation 3 thereof, being a case of deemed concealment on account of non filing of the return. According to the Explanation 4 to Section 271(1)(c), the amount of tax sought to be evaded shall be determined in accordance with the formula provided in clause (a) to (c) of the ....