TMI Blog2021 (6) TMI 73X X X X Extracts X X X X X X X X Extracts X X X X ..... olding that no documentary evidence in support of the explanation was filed. It is not the case of the lower authorities that the assessee had filed a false explanation as result of which additions were made. It is settled position of law that mere rejection of the explanation does not entail levy of penalty u/s 271(1)(c) of the Act as held by the Hon ble Supreme Court in the case of CIT vs. Reliance Petroproducts Pvt. Ltd. [ 2010 (3) TMI 80 - SUPREME COURT ] We are of the considered opinion that it is not a fit case for levy of penalty u/s 271(1)(c) of the Act. - Decided in favour of assessee. - ITA No.725/PUN/2018 - - - Dated:- 1-6-2021 - Shri Inturi Rama Rao, AM And Shri Partha Sarathi Chaudhury, JM For the Assessee : No ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . CIT(A)-6, Pune, who vide order dated 23.03.2015 while confirming the additions also made further addition of ₹ 9,55,000/- on account of unexplained credit, transfer through ATM. Thus, the ld. CIT(A) confirmed the additions made by the Assessing Officer. Subsequently, the Assessing Officer initiated the penalty proceedings by issuing of show-cause notice u/s 274 r.w.s. 271(1)(c) of the Act on 07.01.2014 and further show-cause notice was issued on 08.05.2015 and in response to the same, an explanation filed by the assessee stating that the sources for cash deposits were duly explained and mere fact that the appellant had agreed to the addition does not entail levy of penalty. It was further submitted that mere rejection of the explana ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ppellant had offered an explanation in support of the sources for the cash deposits. It is stated by the appellant during the course of assessment proceedings as well as proceedings before the ld. CIT(A) that the cash deposits were made out of the withdrawals made from the bank through ATM. The Assessing Officer as well as the ld. CIT(A) had rejected this explanation by holding that no documentary evidence in support of the explanation was filed. It is not the case of the lower authorities that the assessee had filed a false explanation as result of which additions were made. It is settled position of law that mere rejection of the explanation does not entail levy of penalty u/s 271(1)(c) of the Act as held by the Hon ble Supreme Court i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nalty is imposed. There can be no dispute that everything would depend upon the return filed, because that is the only document, where the assessee can furnish the particulars of his income. When such particulars are found to be inaccurate, the liability would arise. [Para 8] The word 'particulars' must mean the details supplied in the return, which are not accurate, not exact or correct, not according to truth or erroneous. In the instant case, there was no finding that any details supplied by the assessee in its return were found to be incorrect or erroneous or false. Such not being the case, there would be no question of inviting the penalty under section 271(1)(c). A mere making of the claim, which is not sustainable i ..... X X X X Extracts X X X X X X X X Extracts X X X X
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