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2014 (9) TMI 700 - HC - Income TaxLeviability of penalty u/s 271(1)(c) - Concealment of income warranting levy of penalty or not – Held that:- Following the decision in Commissioner of Income Tax Versus M/s.Gem Granites [2013 (11) TMI 1375 - MADRAS HIGH COURT] - some details were furnished in the form of explanation by the legal representatives of the deceased assessee, but it has been found that except adverting to the letter of the legal heirs of N.R. Palanivel, there is no discussion whatsoever as to the nature of explanation offered by the assessee and his legal heirs - All the Authorities have cursorily dismissed the explanation - It is not as if the explanation was submitted without details - some records were filed along with letter dated 13.1.2009 - the assessee had given some explanation which would fall within the parameters of Explanation B to Section 271(1)(c) of the Income Tax Act. If the Authorities have considered these issues in detail, probably, there would have been no case for the assessee - reasonable explanation was offered by the assessee as to the fixed deposit prior to 31.3.2001 and the renewal of the fixed deposit with interest - He claimed it primarily as family income out of partition and agricultural income. The explanation made on the basis of Explanation B to Section 271(1)(c) of the Income Tax Act to some extent has been satisfied by the assessee and the legal heirs of the assessee - The details given by the legal representatives of the assessee along with the annexures have to be considered by the Authority before ever it proceeds to invoke Section 271(1)(c) - If the Authority still finds that the Explanation is not justified or reasonable, they are entitled to take a different view on the penalty proceedings - But when the assessee has given some reasonable explanation, it is incumbent on the part of the Authority to consider the same on its own merits before proceeding further - This exercise has not been done and the matter is to be remitted back to the AO for consideration of the explanation – Decided in favour of assessee.
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