Home Case Index All Cases Income Tax Income Tax + AT Income Tax - 2022 (5) TMI AT This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2022 (5) TMI 1092 - AT - Income TaxPenalty u/s 271(1)(c) - accrual of income for assessee society - Contribution towards Kalyan Fund, Road Development Fund, Land Development Fund and Charitable Trust Fund - assessee society does not pay full amount to its members but deducts certain amount towards various funds i.e. welfare fund and Hospital fund etc.and these amounts were in the nature of trading receipts and therefore liable to tax and ought to have been shown as income of the assessee - HELD THAT:- It is abundantly clear from the judgment of the Hon`ble Supreme in the case of Siddheshwar Sahakari Sakhar Karkhana Ltd [2004 (9) TMI 6 - SUPREME COURT] that if it is found that certain amounts were deducted by assessee society out of price payable to its members who supplied raw material, conclusion does not necessarily follow that all such realizations get impressed with character of revenue receipts, giving rise to taxable income in the hands of the assessee. Therefore,Contribution towards Kalyan Fund, Road Development Fund, Land Development Fund and Charitable Trust Fund are non-refundable and refundable deposits hence cannot be treated as the income of the Assessee- Societies. In assessee`s appeal assessing officer treated contribution towards welfare Fund and Hospital Fund as income of the assessee and added to the total income of the assessee and then initiated penalty proceedings under section 271(1) (c ) of the Act. We note that these are non-refundable and refundable deposits hence cannot be treated as the income of the Assessee-Societies. Therefore, in both the assessee case there is neither the case of furnishing inaccurate particulars of income nor concealment of income, hence penalty under section 271(1) (c) of the Act should not be levied. - we delete the penalty of both the assessee - Decided in favour of assessee.
|