TMI Blog2019 (1) TMI 525X X X X Extracts X X X X X X X X Extracts X X X X ..... here were sufficient losses to absorb the assessment of cessation of liabilities under section 41(1) the assessee has not taken pains to reconcile the differences in the credit balances with M/s. India Cements Ltd and accepted the addition proposed/made by the AO. Such admissions or surrender of claims etc. will not automatically lead to concealment of income or furnishing of inaccurate particulars for the purpose of levying penalty under section 271(1)(c). As observed that if the claims made by the assessee are not genuine or suppressed/inflated or fabricated or malafide etc., the additions/ disallowances or withdrawal of claims etc. will amount to concealment of income or furnishing of inaccurate particulars for the purpose of section ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nalty of ₹.42,79,470/- under section 271(1)(c) of the Act. On appeal against penalty order, after considering the submissions and facts of the case, the ld. CIT(A) deleted the penalty levied under section 271(1)(c) of the Act, against which, the Revenue is in appeal before the Tribunal. 3. Before us, by referring to the grounds of appeal, the ld. DR has submitted that on verification of the accounts of the creditor M/s. The India Cements Ltd., the outstanding was shown as Nil , whereas, the assessee has claimed an amount of ₹.127.13 lakhs as outstanding to the creditor. With regard to this discrepancy, the assessee has not offered any explanation and thus, the ld. DR pleaded for reversing the appellate order. 4. The notic ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... onsidering the submissions of the assessee and by considering the additions as concealment and furnishing of inaccurate particulars of income, the Assessing levied penalty under section 271(1)(c) of the Act. 6. Against levy of penalty, before the ld. CIT(A), the assessee has submitted that it had been doing business with India Cements Ltd in the earlier years by buying cement. During the course of this business, there were regular purchases and the same were credited to the account of India Cements Ltd. Subsequently, the assessee stopped purchase of cement from India Cements Ltd and there were several unreconciled differences. In addition, some of the payments made to India Cements Ltd were separately shown in a different account and the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed as concealment of income or furnishing of inaccurate particulars for the purpose of levying penalty under section 271(1)(c) of the Act, it should be in the year(s) in which the transactions have been effected. Once the transactions are accepted by the revenue in the earlier years and resulting effects in the subsequent years will not amount to concealment of income or furnishing of inaccurate particulars under section 271(I)(c) of the Act, which means that in the case of unexplained credits, investments etc., the amounts can be brought to tax only in the year in which they were introduced/made. No action can be taken in the subsequent years. Similarly, if the claim of the assessee (on account of purchases etc., which were debited to the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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