TMI Blog2016 (1) TMI 166X X X X Extracts X X X X X X X X Extracts X X X X ..... been furnished and once it is so established, the assessee cannot be held liable for concealment penalty u/s. 271(1) (c) of the Act. Merely because Assessee has not challenged the order of assessment levying tax and interest and has paid tax and interest that by itself will not be sufficient for the authorities either to initiate penalty proceedings or impose penalty. We are of the view that in the absence of complete and convincing corroborative evidence, the Revenue may justify addition, but in the matter of penalty proceedings, the onus lies heavily on the Revenue to prove that the assessee had concealed its income or has filed inaccurate particulars of its income - Decided in favour of assessee. - ITA Nos: 2649, 2650/AHD/2013 - - - ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er alia disallowing the interest expenses of ₹ 4,52,462/- u/s 36(1)(iii) for the reason that the interest was incurred towards the construction of new barge, which according to the AO was a capital expenditure and therefore not allowable. On the aforesaid disallowance of interest expenditure, AO vide order dated 20.6.2012 concluded that interest expenses was wrongly claimed by the assessee more so in view of the fact that the books of accounts of assessee were audited by Chartered Accountants and thereby assessee has concealed the income by furnishing inaccurate particulars of income and therefore Assessee was liable for penalty u/s 271(1)(c) of the Act and accordingly levied penalty of ₹ 1,49,310/-. Aggrieved by the penalty ord ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lowed by AO as according to A.O, the interest incurred for the construction of barge was not allowable as it was in the nature of capital expenditure and by claiming the interest expenditure, Assessee has concealed income by furnishing inaccurate particulars of income. 6. The penalty under s. 271(l)(c) of the Act is leviable if the AO is satisfied in the course of any proceedings under the Act that any person has concealed the particulars of his income or furnished inaccurate particulars of such income. It is well settled that assessment proceedings and penalty proceedings are separate and distinct and the finding in the assessment proceedings cannot be regarded as conclusive for the purposes of the penalty proceedings. 7. The necessa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... g inaccurate particulars thereof. What is to be seen is whether the said claim made by the assessee was bona fide and whether all the material facts relevant thereto have been furnished and once it is so established, the assessee cannot be held liable for concealment penalty u/s. 271(1) (c) of the Act. 9. A case for levy of penalty for concealment of income has to be evaluated in terms of provisions of Explanation. 1 to Section. 271(1)(c), as per which if in relation to any addition in the assessment, the assessee offers no explanation or offers explanation which is found to be false or is not able to substitute the explanation and is also not able to prove that the explanation is bonafide, the addition made would amount to concealment o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ason, the assessee will invite penalty u/s 271(1)(c). That is clearly not the intendment of the Legislature. 10. In view of the aforesaid facts we are of the view that in the present case no penalty is leviable u/s 271(1)(c) and therefore direct its deletion. Thus this ground of Assessee is allowed. 11. In the result the appeal of Assessee is allowed. Now we take up for A.Y. 2008-09 in ITA No. 2650/Ahd/2013 12. In the present cases, since both the parties have admitted that the facts and circumstances of the case are identical to that of A.Y 2006-07 in ITA No. 2649/Ahd/2013 which we have decided hereinabove, we therefore for the reasons stated hereinabove while deciding the appeal for A.Y. 2006-07 in ITA No. 2649/AHD/201 ..... X X X X Extracts X X X X X X X X Extracts X X X X
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