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Shri Amit R Agarwal Versus Asstt. Commissioner of Income Tax

Penalty u/s 271(1) - disallowance made under deeming provisions of section 94(7) - Held that:- We find that in the case of Reliance Petro product Pvt Ltd reported (2010 (3)80 - SUPREME COURT ), in which it has been held that in order to expose to the vigour of penal provision, the case is required to be strictly covered by the provisions of section 271(1)(c) of the Act. It was further held that wrong claim made by the assessee which is not accepted to the revenue cannot be subjected to the provi .....

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hout any basis and explanations furnished by him are not bonafide for making such claim. In that case, the penalty would be levied under section 271(1)(c) of the Act. In our opinion the case of the assessee is squarely covered by the ratio laid down in the case of Reliance Petro Products Ltd (supra). The facts of the case in Zoom Communications P Ltd (supra) are distinguishable from that of the assessee’s case, as in the case of assessee wrong claim was under bonafide belief of the accountant wh .....

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ash Kanojia ORDER Per Rajesh Kumar, Accountant Member This is an appeal by the assessee and is directed against the order of the Ld. CIT(A)-23, Mumbai dated 28.10.2014 pertaining to A.Y.2009-10. 2. The issue raised in grounds of appeal no.1 and 2 is against the confirmation of penalty levied under section 271(1) (c) of the Income Tax Act, 1961 (hereinafter referred to as the Act ) by the ld. CIT(A) as levied by the AO on the disallowance of ₹ 8,83,883/- made under deeming provisions of sec .....

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ng the same as deemed interest under deeming provisions of section 94(7) of the Act and second ₹ 1,78,227/- which relates to cost of acquisition of Birla Sunlife Income Plus. The penalty proceedings under section 271(1)(c) of the Act were initiated and show cause notice dated 12.11.2011 issued. The assessee replied that since the assessee has fully and truly made disclosure of all particulars qua the said items in the return of income and were so treated under the bonafide belief and also .....

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e penalty on the disallowance of ₹ 1,78,227/- while upholding the penalty on second item of disallowance of ₹ 8,83,883/-and thus partly allowed the appeal of the assessee by relying on the decision of the Hon ble Supreme Court in the case of Reliance Petroproduct Pvt Ltd reported in 322 ITR 158 (SC) on the ground that the explanation of the assessee was found to be true and bonafide. 4. We have carefully considered the rival submissions and perused the material placed before us inclu .....

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reveals that the assessee has fully disclosed all the particulars of loss qua the said short term capital loss of ₹ 8,83,883/- from mutual fund in the return of income and thus has not furnished inaccurate particulars qua the said Short term loss. The ld. AR vehemently submitted that the penalty u/s 271(1)9c) of the Act was not imposable in respect of ₹ 8,83,883/- being short term capital loss on mutual funds, the full particulars of which stands disclosed in the return of income fil .....

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on the mutual funds was disallowed by applying deeming provisions of section 94(8) of the Act. The ld. AR submitted that in view of the bonafide error committed by the accountant and the facts being fully disclosed, the penalty was wrongly upheld by the ld. CIT(A) and deserved to be deleted. On the contrary, the ld. DR relied on the orders of authorities below. 5. We find that in the case of Reliance Petro product Pvt Ltd reported (supra), in which it has been held that in order to expose to th .....

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