TMI Blog2014 (4) TMI 703X X X X Extracts X X X X X X X X Extracts X X X X ..... ither concealed incomes or furnished inaccurate particulars of income, two of the parameters necessary for levy of penalty u/s 271(1)(c). Relying upon COMMISSIONER OF INCOME-TAX Versus RELIANCE PETROPRODUCTS PVT. LTD. [2010 (3) TMI 80 - SUPREME COURT] - Mere disallowance of a claim does not lead to penalty u/s 271(1)(c) of the Act – Where there is no finding that any details supplied by 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 claim, which is not sustainable in law, by itself , will not amount to furnishing inaccurate particulars regarding the income of assessee - Such a claim made in the return cannot amount to furnish ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... was pronounced on 27.04.2007 the issue was held against assessee. In quantum proceedings the ITAT confirmed the Assessing Officer s stand. Therefore, A.O. considered that it is a fit case for levy of penalty under section 271(1)(c) of the Act, as assessee has claimed deductions wrongly. 3. The Ld. CIT(A) relying on various case law held that assessee had disclosed properly all material facts and had clearly disclosed the treatment of income in the return of income as well in the audited accounts and financial statements. Even when the return was processed under section 143(1), these facts were available and A.O. discovered the issue only from the financial statements filed voluntarily by assessee. Therefore, he concluded that assessee h ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... se does not lead to levy of penalty under section 271(1)(c) as it cannot be considered that assessee has either concealed incomes or furnished inaccurate particulars of income, two of the parameters necessary for levy of penalty under section 271(1)(c). Mere disallowance of a claim does not lead to penalty under section 271(1)(c), as held by the Hon ble Supreme Court in the case of Reliance Petro Products 322 ITR 158 (SC) wherein it has been held as follows : A glance at the provisions of section 271(1)(c) of the Income Tax Act, 1961, suggests that in order to be covered by it, there has to be concealment of the particulars of the income of assessee. Secondly, assessee must have furnished inaccurate particulars of his income. The meani ..... X X X X Extracts X X X X X X X X Extracts X X X X
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