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2012 (7) TMI 585 - ITAT MUMBAIPenalty u/s 271(1)(c) - Penalty levied on both Principal and Agent - shipping profits were claimed exempt from tax in India - DTAA between India and Mauritius - Held that:- Section 160(1)(i) provides that in respect of income of the non-resident, the agent of such non-resident is to be treated as representative assessee. Thus, the assessment should have been either made in the case of the representative assessee i.e. the agent or to non-resident itself. The department cannot make the assessment on both the persons on agent as well as principal. Similarly, the penalty under Section 271(1)(c) for the same income cannot be levied in the case of both the persons. In the return of income, the assessee had duly disclosed the freight receipts, the income from such freight receipts under presumptive provisions of Section 44B and also the tax payable on such income. Based on this, DIT relief certificate by the AO in India and tax residency certificate by the authorities of Mauritius, tax exemption has been sought in the return of income - as department itself on the one hand, gives certificate for 100% tax relief and on the other hand, treats the same to be provisional in nature, cannot frame the charge of concealment of income or furnishing of inaccurate particulars of income - nowhere it has been found that the assessee was not acting bonafidely - no finding that any details supplied by the assessee in its return were found to be incorrect or erroneous or false as mere making of the claim, which is not sustainable in law, by itself, will not amount to furnishing inaccurate particulars - in favour of assessee.
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