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2016 (5) TMI 56 - ITAT MUMBAI

2016 (5) TMI 56 - ITAT MUMBAI - [2016] 45 ITR (Trib) 177 - Levy of penalty under section 271 (1)(c) - claim of losses - Held that:- On perusal of the assessment order dated February 28, 2006, apparently, the assessee claimed losses with regard to the incomplete work which has not been allowed by the Assessing Officer and the said losses having been added to the income of the assessee. In our view, it is not a case of furnishing inaccurate particulars of income. Making incorrect claim, if any, do .....

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issued by the Institute of Chartered Accountants of India. Accordingly, we set aside the order of the learned Commissioner of Income-tax (Appeals) and direct the Assessing Officer to delete the penalty. - Decided in favour of assessee - I. T. A. No. 2641/Mum/2012 - Dated:- 18-11-2015 - B. R. Baskaran (Accountant Member) And Amarjit Singh (Judicial Member) For the Petitioner : Firoze Andhyarujina, M. N. Golvala For the Respondent : G. M. Das ORDER Amarjit Singh (Judicial Member) 1. This appeal ha .....

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ties is in connection with the levy of penalty under section 271 (1)(c) of the Act amounting to ₹ 3,16,48,949. 3. The facts of the case are that during the course of assessment proceedings, it was noticed that the assessee has claimed expenses on account of provisions made for contract totalling to ₹ 8,61,19,588. The said provisions pertain to 12 of the contracts undertaken by the assessee which were completed/incomplete. The Assessing Officer examined the facts of each and every con .....

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ed on behalf of the assessee-company and the Assessing Officer after providing opportunity of being heard to the assessee passed the order dated March 28, 2011 levying penalty of ₹ 3,16,48,949. Subsequently, the assessee filed an appeal before the learned Commissioner of Income-tax (Appeals), who confirmed the action of the Assessing Officer by his order dated January 27, 2012. Aggrieved by the order of the learned Commissioner of Income-tax (Appeals), the assessee is in appeal before us. .....

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e submitted that the assessee nowhere furnished inaccurate particulars of income and concealed his income to avoid tax liability derived from the said circumstances. It is also specifically submitted that in view of the Accounting Standard 7 revised-2002, the assessee can claim future losses in the relevant assessment year which is quite justifiable, hence, in the said circumstances, the rejection of claim by the Assessing Officer is not falling in the category of furnishing of accurate particul .....

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and the appeal has been admitted on March 26, 2013, therefore, in the said circumstances no action against the assessee for levy of penalty under section 271(1)(c) is required to be taken. In support of this contention the learned authorised representative has placed reliance on the following case law : a) CIT v. Nayan Builders and Developers [2014] 368 ITR 722 (Bom) ; b) Schrader Duncan Ltd. v. Addl. CIT [2015] 37 ITR (Trib) 674 (Mum); c) Westin Hospitality Services P. Ltd. v. DCIT in I. T. A. .....

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e is claiming future losses without any basis hence the Assessing Officer has rightly imposed the penalty and learned Commissioner of Income-tax (Appeals) has also confirmed the said action in accordance with law, therefore, the present caption appeal filed by the assessee is liable to be dismissed. It is also argued by the learned Departmental representative that the order passed by the Assessing Officer for the assessment year 2003-04 has also affirmed by the learned Commissioner of Income-tax .....

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anced by the parties and on careful perusal of the record before us it is required to be seen by this Tribunal that whether the assessee concealed the particulars of income or furnished inaccurate particulars of income to avoid tax liability which attracted the imposition of penalty under section 271(1)(c) of the Act or not. While passing the assessment order by the Assessing Officer for the assessment year 2003-04, the Assessing Officer disallowed the claim, on incomplete contracts and added th .....

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