TMI Blog2019 (7) TMI 545X X X X Extracts X X X X X X X X Extracts X X X X ..... inadvertent error. The decision in the case of Price Waterhouse Coopers Private Limited [ 2012 (9) TMI 775 - SUPREME COURT] is also identical where in the tax audit report filed by the assessee, it was indicated that provision towards payment of gratuity was not allowable, but the assessee therein failed to add the said provision to total income. Considering the said fact, the Hon'ble Supreme Court held that no penalty could be imposed for such mistake. As noted by the CIT(A) as well as the Tribunal, the conduct of the assessee clearly establishes that it is an inadvertent error and cannot be stated to be a contumacious conduct on the part of the assessee and cannot be stated to be with an intention to understate his income by f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d loss account? 3.We have heard Mrs.R.Hemalatha, learned Senior Standing Counsel for the appellant/Revenue; and Mr.A.S.Sriraman, learned counsel for the respondent/assessee. 4.With the consent on either side, the appeal itself is taken up for disposal. 5.The first substantial question of law raised by the Revenue is whether the Tribunal is correct in holding that penalty levied under Section 271(1)(c) of the Act is not attracted even if the assessee had claimed unpaid interest to the schedule bank in its profit and loss account and failed to disallow the same under Section 43B(e) of the Act. 6.The second question which has been raised by the Revenue is whether the Tribunal was co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t assessment year 2012-13. Accordingly, the Assessing Officer imposed minimum penalty of ₹ 50,28,975/-. 8.The assessee carried the matter by way of appeal to the Commissioner of Income-tax (Appeals)-1, Chennai ( the CIT(A) , for brevity). Before the CIT(A), the assessee contended that this amount was clearly disclosed by the assessee in the audit report, that is, in point no.11 of the statutory audit report, dated 15.05.2012, and in page no.14 of the annual report for the financial year 2011-12, which was filed along with the return. The said record was also placed before the CIT(A). The assessee further stated that it is a bona fide error, inasmuch as this amount and details were disclosed by the assessee in the docume ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f the Sick Industrial Companies Act, vide order dated 19.04.2011 and Board for Industrial and Financial Reconstruction issued directions to the lenders and to the assessee to submit a Rehabilitation Scheme as per Section 18 of the Sick Industrial Companies Act. Further, the Tribunal noted the reply given by the assessee stating that the term loan obligations and interest commitments have been met in full with respect to the State Bank of India in accordance with the terms and conditions of the sanction letter. However, the assessee has defaulted in repayments of term loans amounting to ₹ 0.22 crores and interest commitments amounting to ₹ 1.55 crores with respect to HDFC Bank's borrowings and that the term loan repayment is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nalty under Section 271(1)(c) of the Act. Admittedly, the case on hand is not a case of survey, but it is a case where the assessee having come to know about the same, after the Assessing Officer pointed it out, immediately filed petition for rectification under Section 154 along with explanation stating that it is an inadvertent error. The decision in the case of Price Waterhouse Coopers Private Limited (supra) is also identical where in the tax audit report filed by the assessee, it was indicated that provision towards payment of gratuity was not allowable, but the assessee therein failed to add the said provision to total income. Considering the said fact, the Hon'ble Supreme Court held that no penalty could be imposed for such m ..... X X X X Extracts X X X X X X X X Extracts X X X X
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