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2014 (12) TMI 1058 - AT - Income TaxLevy of penalty u/s 271(1)(c) - Assessee furnished inaccurate particulars at the time of assessment proceedings and claimed deduction u/s 10A at an amount higher than the actual eligibility or not – Held that:- No penalty u/s 271(1)(c) of the Act can be justifiably be levied on the facts - Revenue Authority has failed to establish that in the return of income the assessee has either shown as incorrect or inaccurate particulars of income - merely because the AO did not agree with the submission made by the assessee, the same cannot be said to be furnished of inaccurate particulars of income for the purpose of levying penalty u/s 271(1)(c). Disallowances of expenditure cannot result in automatic levy of penalty - If an assessee has been able to offer an explanation, which is not found by the Revenue Authority to be false, and assessee has been able to prove that such explanation is bonafide and that all the facts relating to the same have been disclosed by the assessee - assessee shall be out of the clutches of Explanation1 to section 271(1)(c) of the IT Act and in such cases no penalty shall be imposed – relying upon CIT vs. Reliance Petro Products Pvt. Limited [2010 (3) TMI 80 - SUPREME COURT] - no penalty u/s 271(1)(c) of the Act can be imposed because the Revenue Authority has not disclosed any facts in its return of income - even otherwise Revenue Authority has failed to establish that in the return of income assessee has either been shown as inaccurate or incorrect particulars of its income - merely because the expenditure claimed by the assessee has been disallowed by the Revenue Authority does not lead to an inference that it is a case of furnishing inaccurate particulars of income - assessee has offered its bona fide explanation which was not proved false by the Revenue Authority – FAA has passed the well-reasoned order and the order of the CIT(A) is upheld – Decided against revenue.
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