TMI Blog2017 (4) TMI 53X X X X Extracts X X X X X X X X Extracts X X X X ..... d that the assessee had disclosed all the materials before the authorities below and the law is well settled that penalty proceedings and quantum proceedings are two different and distinct proceedings. The claim of the assessee was reiterated on the ground that in quantum the assessee has claimed short-term capital loss on account of sale of shares. A mere making of a claim, which is not sustainable in law, by itself, will not amount to furnishing inaccurate particulars regarding the income of the assessee. See COMMISSIONER OF INCOME-TAX Versus RELIANCE PETROPRODUCTS PVT. LTD. [2010 (3) TMI 80 - SUPREME COURT ] - Decided in favour of assessee - ITA No. 614/JP/2014 - - - Dated:- 23-3-2017 - Shri Kul Bharat, JM And Shri Vikram Singh Yadav ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssee is in further appeal before this Tribunal. 3. The ld. Counsel reiterated the submission as made in the written brief. It is submitted that initiation of penalty u/s 271(1)(c) of the Act is illegal as the Assessing Officer in the assessment order initiated the penalty without specifying the charge. The ld. Counsel placed reliance on the judgment of the Hon ble Karnataka High Court rendered in the case of CIT Vs. Manjunatha Cotton and Ginning Factory 358 ITR 565 (Karn), and also submitted that there is neither concealment nor furnishing of inaccurate particulars as the assessee has placed all material before the Assessing Officer. The Assessing Officer has sought clarification on the material so placed before the assessing officer and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... id liability of capital gain tax on account of sale of long-term capital asset. We find that the Assessing Officer while initiating the proceedings in the assessment order dated 20/12/2010/- has sated as under :- Penalty Proceedings u/s 271(1)(c) rws 274 has been initiated separately for concealment of income/furnishings of inaccurate particulars of income. From the above, it is evident that initiation of proceeding is not specific while imposing penalty in the penalty order dated 22/3/2013. The Assessing Officer, in para 7 stated as under:- In view of aforesaid discussion, it is clearly established and satisfied that the assessee has concealed/furnished inaccurate particulars of income to the extent of ₹ 45,00,000/- a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dings under section 271(1)(c) is a sine qua non for the Assessing Officer to initiate the proceedings because of the deeming provision contained in sub-section(1B). (h) The said deeming provisions are not applicable to be orders passed by the Commissioner of Income-Tax(Appeals) and the commissioner. (i) The imposition of penalty is not automatic. (j) The imposition of penalty even if the tax liability is admitted is not automatic. (k) Even I the assessee has not challenged the order of assessment levying tax and interest and has paid tax and interest that by itself would not be sufficient for the authorities either to initiate penalty proceedings or impose penalty, unless it is discernible from the assessment order t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... requirement of law. (R) The assessee should know the grounds which he has to meet specifically. Otherwise, the principles of natural justice is offended. On the basis of such proceedings, no penalty could be imposed to the assessee. (S) Taking up o penalty proceedings on one limb an finding the assessee guilty of another limb is bad in law. (T) The penalty proceedings are distinct from the assessment proceedings. The proceedings for imposition of penalty though emanate from proceedings of assessment, it is independent and separate aspect of the proceedings. (U) The findings recorded in the assessment proceedings in so far as concealment of income and furnishing of incorrect particulars would not operate as res ju ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e argued that the falsehood in accounts can take either of the two forms; (i) an item of receipt may be suppressed fraudulently; (ii) an item of expenditure may be falsely) or in an exaggerated amount) claimed, and both types attempt to reduce the taxable income and, therefore, both types amount to concealment of particulars of one s income as well as furnishing of inaccurate particulars of income. We do not agree, as the assessee had furnished all the details of its expenditure as well as income in its return, which details, in themselves, were not found to be inaccurate nor could be viewed as the concealment of income on its part. It was up to the authorities to accept its claim in the return or not. Merely because the assessee had claime ..... X X X X Extracts X X X X X X X X Extracts X X X X
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