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Pr. Commissioner of Income Tax-II, Lucknow Versus M/s. Jal Vidyut Nigam Ltd.

2016 (1) TMI 789 - ALLAHABAD HIGH COURT

Penalty u/s 271 (1)(c) - disallowance of expenditure - Held that:- A wrong explanation cannot amount to furnishing of an incorrect particular. The non-furnishing of explanation falls within the same zone of consideration unless there is any adverse evidence to indicate that the concealment was deliberate or incorrectly depicted in the return with a view to evade any liability. The explanation in relation to Section 271 (1)(c) as pressed into service read with clause (B) if read together, the sam .....

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proceedings in the facts and circumstances of the case can not be sustained. - Decided in favour of assessee. - Income Tax Appeal No. - 3 of 2016 - Dated:- 18-1-2016 - Hon'ble Amreshwar Pratap Sahi And Hon'ble Attau Rahman Masoodi, JJ. For the Appellant : Manish Misra ORDER Heard Sri Manish Misra, learned counsel for the appellant. The department has come up questioning the correctness of the reversal order of the Assessing Officer and the Commissioner of Income Tax on the ground that t .....

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d loss account which was stated in the return could not be substantiated by furnishing any details or particulars by the assessee. To the contrary the assessee claimed an additional adjustment which clearly established the concealment and non-explanation of the facts about an amount of ₹ 6,04,418/-. It is this figure which has been treated to be an inaccurate particular for the financial year 2008 and 2009 along with the incorrect figures of leave encashment as detailed in the order of the .....

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e the Tribunal and the Tribunal has affirmed the order of the Commissioner Income Tax. Both these authorities have held that there was no inaccurate disclosure or untrue explanation given by the assessee for any justification to impose penalty. We have considered the aforesaid submissions raised and from the aforesaid findings recorded, the first issue is about as to what is the alleged concealment or inaccurate particulars in respect to the return filed by the assessee. Learned counsel for the .....

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n on this issue has been dealt with by the Apex Court in the case of Commissioner of Income Tax Vs. Reliance Petro Products Pvt. Ltd. (2010) 322 ITR 158, paragraph 7 of the judgment is extracted hereinunder:- "As against this, Learned Counsel appearing on behalf of the respondent pointed out that the language of Section 271(1)(c) had to be strictly construed, this being a taxing statute and more particularly the one providing for penalty. It was pointed out that unless the wording directly .....

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me or furnished inaccurate particulars of such income." A glance at this provision would suggest that in order to be covered, there has to be concealment of the particulars of the income of the assessee. Secondly, the assessee must have furnished inaccurate particulars of his income. Present is not the case of concealment of the income. That is not the case of the Revenue either. However, the Learned Counsel for Revenue suggested that by making incorrect claim for the expenditure on interes .....

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It is not as if any statement made or any detail supplied was found to be factually incorrect. Hence, at least, prima facie, the assessee cannot be held guilty of furnishing inaccurate particulars. The Learned Counsel argued that "submitting an incorrect claim in law for the expenditure on interest would amount to giving inaccurate particulars of such income". We do not think that such can be the interpretation of the concerned words. The words are plain and simple. In order to expose .....

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has concealed the particulars of his income or furnished inaccurate particulars of such income. This Court referred to another decision of this Court in Union of India Vs. Dharamendra Textile Processors (2007) 212 CTR (SC) 432 : (2008) 13 SCC 369, as also, the decision in Union of India Vs.Rajasthan Spinning & Weaving Mills (2009) 224 CTR (SC) 1: (2009) 23 DTR (SC) 158:(2009) 13 SCC 448 and reiterated in para 13 that:- "13. It goes without saying that for applicability of Section 271(1 .....

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