Decoding the Penalty Provisions under Section 271(1)(c): Analyzing the Fine Line Between Concealment and Inaccuracy in Taxation

Furnishing inaccurate particulars cannot be presumed from mere disallowance; defective notices and bona fide claims constrain penalties.

Penalty for furnishing inaccurate particulars of income requires proof of knowingly misstated or concealed particulars; mere disallowance of a claim does not suffice. A bona fide, arguable claim should not automatically attract penalty, and a defective or unadapted notice that fails to demonstrate application of mind can vitiate penalty proceedings.