Home Case Index All Cases Income Tax Income Tax + AT Income Tax - 2016 (11) TMI AT This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2016 (11) TMI 441 - ITAT MUMBAIPenalty u/s.271(1)(c) - expenditure incurred on account of capital assets was claimed as revenue expenditure and depreciation was also claimed - Indo- Mauritius DTAA - Held that:- Intention of the assessees in claiming capital expenditure as allowable expenditure and further claiming depreciation is visible to the proverbial ‘naked eyes’ ,so, if the AO/FAA decided not to remain a mute spectator to such an attempt, no fault can be found with them. The FAA has in his elaborate order clearly proved that as to how the explanation of the assessee was not genuine or bona fide and how it is not supported by any authority. Rather the available material was against the stand taken by the assessee. It is also a fact that the assessee not a small time trader running a proprietary concern or a shop in the remote part of the country and is not aware of the tax laws.It is supported by a team of professionals. Such assessees are expected to lead from front and not to claim deductions that are prima facie not admissible. Let us make it clear that we do not want to mix ethics and penalty matters. What we are emphasising is that assessee availing professional services should not make claims that are prima facie inadmissible to avoid penal consequences. We would also like to mention that the cases relied upon by the assessee are distinguishable on facts. N.G. Technologies (2013 (7) TMI 451 - KARNATAKA HIGH COURT ) is useful in deciding the issue In that matter the assessee had pleaded that claim made by it was bonafide and all the facts were disclosed. The FAA, upholding the order of the AO, had held that mistake committed by the assessee could not be said to be bonafide. However, the Tribunal reversed the order of the FAA. The Hon’ble Apex Court [ 2016 (4) TMI 1152 - SUPREME COURT ] dismissed the SLP against High Court's ruling that where against basic principle of accountancy, assessee claimed capital loss on sale of fixed assets in profit and loss account and had not revised return voluntarily, penalty for concealment of income was justified - Decided against assessee
|