TMI Blog2016 (9) TMI 544X X X X Extracts X X X X X X X X Extracts X X X X ..... ce of some of the expenditure incurred by the assessee. - Decided in favour of assessee - ITA No.6837/Mum/2013 - - - Dated:- 3-8-2016 - SHRI R.C.SHARMA, AM AND SHRI PAWAN SINGH, JM For The Assessee : Sh.Haresh G.Buch Ms.Monika Agarwal For The Revenue : Shri Samuel Dorse ORDER PER R.C.SHARMA (A.M) : This is an appeal filed by the assessee against the order of CIT(A), Mumbai, for the assessment year 2007-2008, in the matter of imposition of penalty u/s.271(1)(c) of the I.T.Act. 2. In this case, penalty has been imposed for disallowance of sum of the expenditure claimed by assessee in respect of brokerage and professional expenses. For this disallowance the AO has also levied penalty u/s.271(1)(c). 3. It wa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the assessee and as such it cannot be allowed as the business expenses. The assessee claimed ₹ 10,25,000/- as business expense towards professional fees paid for attending to all meetings, drafting and settling letter of intent, lease agreement etc. in respect of leasing of office premises. The ACIT disallowed the Appellants claim for deduction on the ground that these expenses were not related to the business of the assessee and as such it cannot be allowed as the business expenses. 7. As per the nature of the assessee s business, following principle of commercial expediency assessee has incurred expenditure of brokerage as well as professional fees. Assessee being in the business of real estate business, professional fees are re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in law. The Supreme Court merely stated that willful concealment is not an essential ingredient. for attracting a civil law liability under section 271(1)(c) read with the explanation thereto. In other words, all that the judgment holds is that the concealment need not be willful to attract penalty. However to attract the provisions of section 271, the assessee must be held to have concealed the material particulars or to have furnished inaccurate particulars. At the cost of repetition in the present case, there was no concealment of any material particulars by the respondent. Nor did the respondent furnish inaccurate particulars. The respondent disclosed all material particulars and on the basis thereof, made certain claims which have been ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r 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 the Revenue suggested that by making incorrect claim for the expenditure on interest, the assessee has furnished inaccurate particulars of the income. As per Law Lexicon, the meaning of the word particular is a detail or details (in plural sense); the details of a claim, or the separate items of an account. Therefore, the word particulars used in Section 271(1)(c) would embrace the meaning of the details of the claim made. It is an adm ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ein must .exist. 19. It was tried to be suggested that Section 14-A of the Act specifically excluded the deductions in respect of the expenditure incurred by the assessee in relation- to income which does. not form part of the total income under the Act. It was further pointed out that the dividends from the shares did not form part of the total income. It I was, therefore, reiterated before us that the assessing officer had correctly reached the conclusion . that since the assessee had claimed excessive deductions knowing that they are incorrect; it amounted to concealment of income. It was tried to be argued that the falsehood in accounts can take either of the two forms; (I) an item of receipt may be suppressed fraudulently; (ii) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e reflected in the accounts of the assessee. This Court, therefore, observed: (SCC p. 688, para 7) 7. So far as the question of penalty is concerned the items which were not included in the turnover were found incorporated in the appellant's accounts books. Where certain items which are not included in the turnover are disclosed in the dealer's own account books and the assessing authorities include these items in the dealer's turnover disallowing the exemption penalty cannot be imposed. The penalty levied stands set aside. The situation in the present case is still better as no fault has been found with the particulars submitted by the assessee in its return. (emphasis supplied) The Supreme Court also held ..... X X X X Extracts X X X X X X X X Extracts X X X X
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