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2019 (12) TMI 27 - AT - Income TaxPenalty u/s 271(1)(c) - omission on the part of the assessee to account for the interest portion of the refund - HELD THAT:- We have given a thoughtful consideration and are unable to subscribe to the imposition of penalty u/s 271(1)(c) on the amount of interest of ₹ 2,455/- received by the assessee on the Income Tax Refund for A.Y 2006-07 received during the year under consideration. As observed by us the assessee had credited his ‘Capital account’ for the year under consideration by the amount of the Income Tax Refund (including interest) of ₹ 1,08,910/-. A mere bonafide omission on the part of the assessee to account for the interest portion of the refund (which though had duly been reflected in his ‘Capital account’), would though have justified an addition to the said extent, however, a levy of penalty u/s 271(1)(c) merely for the said bonafide mistake would be totally unjustified. Our aforesaid view is fortified by the judgment in the case of Price Waterhouse Coopers Pvt. Ltd. Vs. CIT [2012 (9) TMI 775 - SUPREME COURT] . We thus ‘set aside’ the penalty imposed by the A.O in respect of the addition of the Income Tax refund. On the basis of our aforesaid observations, we vacate the penalty imposed by the A.O u/s 271(1)(c), which thereafter had been sustained by the CIT(A). - Decided in favour of assessee.
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