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TMI Blog2018 (11) TMI 944X X X X Extracts X X X X X X X X Extracts X X X X ..... 1(l)(c) of the Act amounting to Rs. 15,51,146/-without appreciating the fact that assessee has wilfully avoided the disallowance of STT and donation paid to its computation of total income. 2. Whether on the facts and circumstances of the case and in law, the id. CIT(A) was right in deleting the penalty levied u/s. 271(l)(c) of the Act amounting to Rs. 15,51,146/- without appreciating the fact that the assessee is not entitled for deduction on account of donation paid in the absence of required documentary evidences like receipt and valid exemption certificate of the done." 2. The brief facts of the case are that the assessee is a domestic company engaged in the business of trading in shares and securities, filed its return of income for ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssions of the assessee and also by following the decision of Hon'ble Supreme Court in the case of Dharmendra Textile Processors vs UOI (2008) 306 ITR 277 held that the additions made in the quantum assessment having attained finality and such addition has been made after examination of books of account, therefore, there is no merit in the arguments of the assessee that it is an inadvertent error while computing total income. The evidence against the assessee would not have come to light but for the enquiries conducted in the course of the scrutiny assessment proceedings. Therefore, he opined that it is a fit case for imposition of penalty for furnishing inaccurate particulars of income and hence levied penalty of Rs. 15,51,146 which is 100% ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e accounts, merely for the reason that the disallowance needs to be added back in total income, have not been added, cannot be considered as furnishing of inaccurate particulars of income which warrants levy of penalty u/s 271(1)(c). The relevant observations of the Ld.CIT(A) are extracted below:- "3.2 I have considered the appellant's submissions. In this case AO had levied penalty u7s 271(1)(c) on the ground that appellant had filed inaccurate particulars of income. AO in the assessment order disallowed Rs. 50,00, 0007- on donation paid and Rs. 19, 891 7- on account of Security transaction, tax. In the appellant's submission appellant states that they filed claim of donation and Security transaction tax to Administrative and Oth ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... careful cannot be doubted, but absence of due care, in a case such as the present, does not mean that the assessee is guilty of either furnishing inaccurate particulars or attempting to conceal its income. Consequently, given the peculiar facts of this case, the imposition of penalty on the assessee is not justified." In the above Supreme Court case also appellant had claimed provision for gratuity as an expenditure but they have not disallowed the same by adding to the total income while filing the return of income. When AO levied penalty, Supreme Court held that here the particulars filed by appellant are not inaccurate or there is no question of concealment of income. According to the Supreme Court all that happened in the above Price ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , failed to add back donation paid and STT in the statement of total income which has been subsequently rectified by filing revised statement of total income before completion of assessment which is evident from the fact that the AO has not made any addition in the assessment order. The AO has accepted the revised statement of total income filed by assessee vide letter dated 27-01-2015, but initiated penalty proceedings on those two items for furnishing inaccurate particulars of income. When the primary facts have been disclosed in the return filed for the relevant year and there is an omission to add back certain disallowance, the same cannot be considered as willful attempt made to evade payment of tax which warrants levy of penalty u/s 2 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ose facts, the Hon'ble Apex Court held that this cannot be considered as wilful attempt made to evade payment of taxes and at best, it could be termed as a human error which we are all prone to make. In this case, on perusal of facts, we find that although the assessee has disclosed all facts in respect of those two items of expenses, but failed to add back in the statement of total income, while filing return of income. The said mistake has been rectified immediately after noticing during the course of assessment proceedings by filing revised statement of total income. Under these facts and circumstances, the AO was incorrect in coming to the conclusion that the assessee has furnished inaccurate particulars of income in respect of donation ..... X X X X Extracts X X X X X X X X Extracts X X X X
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