2015 (10) TMI 2592 - ITAT KOLKATA - Income Tax

Head Note / Extract:
Penalty u/s 271(1)(c ) - Held that:- Penalty proceedings are distinct and separate from assessment proceedings and just because an addition has been sustained in quantum proceedings, levy of penalty is not automatic. What has to be seen is whether there was a bonafide belief and bonafide explanation given by the assessee. If it is so, no penalty could be levied u/s 271(1)(c ) of the Act. Moreover, we also find that the additions sustained by this tribunal in quantum proceedings in the sum of ₹ 1,45,000/- has been admitted by the Hon’ble Calcutta High Court as involving substantial question of law. Hence we hold that no penalty could be levied u/s 271(1)(c ) of the Act in respect of issues involving substantial question of law as no allegation could be raised on the assessee with regard to concealment of income or furnishing of inaccurate particulars of income and the issue involved is highly debatable in nature - Decided in favour of assessee