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2016 (12) TMI 168 - AT - Income TaxPenalty u/s. 271(1)(c) - false claim of business expenditure - Held that:- As in the notes to account there is no mention of the payment of ₹ 73,60,000/- and the reasons for making this payment. No rebuttal has been given by the assessee to these findings of fact, which go to suggest that the appellant has not made a complete disclosure in terms of Explanation 1 to section 271(1)(c) of the Act. We therefore, find no justification to disregard the finding of the ld. CIT(A) that the assessee had made a false claim that he is engaged in the hotel business with motive to claim deduction of impugned expenditure falsely as revenue expenses. The explanation offered by the assessee being not bona fide, the ld. Authorities below have rightly applied Explanation 1 to section 271(1)(c) of the Act in the peculiar facts and circumstances of the present case. In view of above discussion, it follows that it is not a case where the explanation given by assessee was bona fide and there was full disclosure of facts. The assessee has also not been able to substantiate the explanation offered by any credible evidence. - Decided against assessee
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