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2017 (12) TMI 1474 - AT - Income TaxLevy of penalty u/s 271(1)(c) - addition on account on account of difference of opinion - Held that:- The admission or a rejection of a claim is a subjective matter and whether a claim is accepted or rejected has nothing to do with furnishing of inaccurate particulars of income, what is a correct claim and what is incorrect claim is a matter of opinion. Raising a legal claim, even if it ultimately found to be legally unacceptable, cannot amount to furnishing of inaccurate particulars of income. A bonafide claim by the assessee being visited with penal consequences only because it has not been accepted by the tax authorities or judicial authorities, is an absurdity. In any event the connation of expression inaccurate particulars do not extent to the issues of interpretation of laws and as such making a claim, which is found unacceptable in law, cannot be treated as furnishing of inaccurate particulars of income. In this case, no information/figures in the return of income was found to be incorrect or inaccurate. The same was reflected in books of accounts. All books of accounts were maintained and Audited by the assessee. Only Notional interest was calculated and was disallowed from actual interest expenditure paid to bank. Disallowance was merely on account on account of difference of opinion and has nothing to do with concealment of income or furnishing of inaccurate particulars. It is clear that mere disallowance in the assessment proceedings could not be the sole basis for levying penalty u/s.271(1)(c). - Decided in favour of assessee.
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