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2014 (6) TMI 606 - AT - Income TaxLevy of penalty u/s 271(1)(c) of the Act – Claim of interest - Held that:- Following Bharat Commerce and Industries Ltd vs. CIT [1998 (3) TMI 2 - SUPREME Court] – the tax under the Act as well as the interest on the short fall in its payment is paid by the assessee not in his capacity as a trader, but as a taxable entity under the Act, levying tax on income or profits from any activity, including from business or profession – it does not qualify to be an outgoing of the business, which has to be adjudged in the light of the accepted commercial practices and trading principles. A ‘mistake’ is itself an admission of a wrong claim and, thus, of an inability to explain the same, so that there is by definition concealment and/or furnishing inaccurate particulars of income - a ‘mistake’ cannot be said to be deliberate, which a sine qua non of penalty - the assessee’s action in claiming the interest cannot be said to be a ‘mistake’ - the claim that it is the booking of the interest in accounts that led to the wrong claim in the return, is not correct - If the interest gets included as an organizational expense by ‘mistake’, the same would also likewise stand to be included in working the disallowance u/s14A – there was no justification by the assessee for the exclusion of interest on the ground that the same does not finance, either in whole or in part, the investments yielding income not forming part of the total income – thus, the contentions of the assessee cannot be accepted and the levy of penalty is upheld – Decided against Assessee.
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