TMI Blog2010 (5) TMI 535X X X X Extracts X X X X X X X X Extracts X X X X ..... hich may call for levy of penalty under section 271(1)(c) – Appeal is dismissed - IT APPEAL NO. 4760 (MUM.) OF 2009 - - - Dated:- 7-5-2010 - D. K. Agarwal, T. R. Sood, JJ. Sumeet Kumar for the Appellant. R.C. Jain for the Respondent ORDER D.K. Agarwal, Judicial Member. This appeal preferred by the revenue is directed against the order dated 11-6-2009 passed by the ld. CIT(A) for the assessment year 2005-06. 2. Briefly stated facts of the case are that the assessee-company is engaged in the business of development and construction. It filed return declaring total income of ₹ 8,36,510 after claiming deduction under section 80-IB(10) of the Income-tax Act, 1961 ( the Act ) ₹ 57,67,289. Duri ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eaning of section 271(1)( c ) of the Act and accordingly imposed penalty of ₹ 2,67,644 vide order dated 26-5-2008 passed under section 271(1)( c ) of the Act. On appeal, the ld. CIT(A) while observing that the assessee-company was under a bona fide impression that the income in question was eligible for deduction under section 80-IB, hence, there is no concealment or furnishing of inaccurate particulars of his income, held that the Assessing Officer was not correct in levying penalty under section 271(1)( c ) and accordingly, deleted the penalty imposed by the Assessing Officer. 3. Being aggrieved by the order of the ld. CIT(A) the revenue is in appeal before us taking following effective ground of appeal : On the facts a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e particulars of income. The ld. Counsel for the assessee while relying on the order of the ld. CIT(A) also relied on the recent decision of the Hon ble Supreme Court in CIT v. Reliance Petroproducts (P.) Ltd. [2010] 189 Taxman 322 wherein it has been held that a mere making of the claim, which is not sustainable in law, by itself, will not amount to furnishing inaccurate particulars regarding the income of the assessee. He therefore, submits that the order passed by the ld. CIT(A) in deleting the penalty imposed by the Assessing Officer be upheld. 6. We have carefully considered the submissions of the rival parties and perused the material available on record. We find that the facts are not in dispute inasmuch as it is also not in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sing Officer that the assessee has concealed the particulars of his income. The Assessing Officer has imposed penalty on the ground that the assessee has furnished inaccurate particulars of his income. 9. In a recent judgment of the Hon ble Apex Court in Reliance Petroproducts (P.) Ltd. s case ( supra ) it has been observed as under (page 164 of the report): ......In order to expose the assessee to the penalty unless the case is strictly covered by the provision, the penalty provision cannot be invoked. By any stretch of imagination, making an incorrect claim in law cannot tantamount to furnishing inaccurate particulars. In Commissioner of Income-tax, Delhi v. Atul Mohan Bindal [2009] 9 SCC 589, where this Court was consideri ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... be invoked. By no stretch of imagination can making an incorrect claim tantamount to furnishing inaccurate particulars. There can be no dispute that everything would depend upon the return filed by the assessee, because that is the only document where the assessee can furnish the particulars of his income. When such particulars are found to be inaccurate, the liability would arise. To attract penalty, the details supplied in the return must not be accurate, not exact or correct, not according to the truth or erroneous. Where there is no finding that any details supplied by the assessee in its return are found to be incorrect or erroneous or false there is no question of inviting the penalty under section 271(1)( c ). A mere making of a c ..... X X X X Extracts X X X X X X X X Extracts X X X X
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