2023 (2) TMI 519 - AT - Income Tax

Penalty u/s.271(1)(c) - Addition u/s 69 - unexplained investment - addition with respect to investment made during the year only could be made - HELD THAT:- Source of investment made in immoveable property was furnished by the assessee ,as invested by Sh.Rashmikant C. Patel. The same has not been found to be false or untrue by the Revenue. Even particulars pertaining to the explanation of the assessee as to why payment was made by the other coowner has not been found to be false by the Revenue. The assesses explanation of the payment made by the other co-owner on account of advance given by the assessee, we find, is not disputed by the Revenue with respect to the factum of advance given by the assessee. The only reason for rejecting the explanation is that it was found unacceptable since advance was given in preceding year.

Therefore clearly all particulars relating to the source of investment were furnished by the assessee which were not found to be inaccurate or even incorrect by the Revenue. Even the explanation of the source of investment was not found to be false by the Revenue.

As merely found to be unacceptable since advance was given by assessee to co-owner in preceding year. It is settled law that mere rejection of a claim of the assessee will not invite levy of penalty u/s 271(1)(c) - The assessee in such circumstances, we hold, cannot be charged with having furnished any inaccurate particulars of income or concealed any particulars of income so as to attract levy of penalty u/s 271(1)(c) - Assessee appeal allowed.