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2019 (8) TMI 845 - AT - Income TaxLevy of penalty u/s 271(1)(c) - Disallowance u/s 14A - assessee accepted disallowance to the extend of dividend income - HELD THAT:- Under the very scheme under section 14A, the apportionment of the expenditure attributable to earning exempt income, was difficult for identifying exactly on the precise, numerical and mathematical basis and to have rationality in the disallowance, the rule 8D has been introduced by the CBDT, but that too is a kind of estimate only. The difference between the suo-motu disallowance by the assessee in the return of income and the amount upheld by the AO, can be termed as variation in the estimate of expenditure attributable to earning exempt income by the assessee and by the AO and same cannot be tantamount to furnishing of any inaccurate particulars of income. Merely making a claim, which is held as non-sustainable under the law, should not lead to penalty under section 271(1)(c) of the Act, when the assessee has furnished details of particulars in the return of income. The assessee is not found to be involved in camouflaging or filing inaccurate details of expenses. Every disallowance made does not justify and mandate levy of penalty u/s 271(1)(c) - in the case of CIT versus Reliance Petro Products Private Limited [2010 (3) TMI 80 - SUPREME COURT] held that where no information given in the return of income is found to be incorrect or inaccurate, the assessee cannot be held guilty of furnishing inaccurate particulars and by no stretch of imagination making an incorrect claim can tantamount to furnishing inaccurate particular of income. - Decided in favour of assessee.
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