TaxTMI 
TaxTMI 
2026 (6) TMI 1399
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....Mr. Saurabh Soparkar with learned advocate Mr. B.S. Soparkar for the respondent. 2. This appeal is filed under Section 260A of the Income Tax Act, 1961 (hereinafter referred to as "the Act" for short) on the following substantial question of law arising out of the order dated 13.01.2020 passed by the Income Tax Appellate Tribunal, "C" Bench, Ahmedabad being ITA No. 2739/Ahd/2011 for Assessment Year 2005-06: "(a) Whether the Appellate Tribunal is right in law and on facts in correctly appreciating the facts on record and law so as to cancel the penalty levied under section 271(1)(c) of the Act?" 3. The respondent assessee is a foreign company engaged in the business of exploration, prospecting, production & marketing of natura....
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....pon the decision of the Tribunal in case of Niko Resource Limited in ITA No. 2475/AHD/2008 wherein similar facts penalty levied by the revenue was deleted. 6. At the outset, learned Senior Standing Counsel Mr. Varun Patel for the appellant and learned Senior Counsel Mr. Soparkar for the respondent submitted that the decision of the Tribunal in NIKO Resources Ltd., was challenged by way of Tax Appeal No. 2256 of 2010 by the revenue and the same was dismissed by this Court vide judgment and order dated 13.11.2025, reported in [2025] 180 taxmann.com 816 (Gujarat). 7. In view of the above submissions, it would be germane to refer to the observations and decision of the Tribunal in case of NIKO Resources Ltd., referred to in the order date....
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.... liability would arise. To attract penalty, the details supplied in the return must not be accurate, not exact or correct, not according to the truth or erroneous. Where there is no finding that any details supplied by the assessee in its return are found to be incorrect or erroneous or false there is no question of inviting the penalty under section 271(1)(c). A mere making of a claim, which is not sustainable in law, by itself, will not amount to furnishing inaccurate particulars regarding the income of the assessee. Such a claim made in the return cannot amount to furnishing inaccurate particulars. Decision of the Gujarat High Court affirmed." 8. It is true in quantum proceeding, disallowance of expenditure cla....
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....s (i) bona fide and (ii) if he had disclosed all the facts relating to the same and material to the computation of his total income. In cases where explanation was offered, but was rejected as it could not be substantiated by the assessee, there would arise no presumption of concealment of the particulars of income that was added or disallowed and such assessee can show that the said explanation offered by him was a bona fide one and that he had disclosed all facts relating to such explanation and material to the computation of his total income during the quantum proceeding." 9. In the present case, the assessee has disclosed all the material facts. It is not only bona fide but the assess has also substantiated the same by the fact....