TMI Blog2019 (3) TMI 552X X X X Extracts X X X X X X X X Extracts X X X X ..... concern. As construed as bona fide human error i.e. failure to add back a particular provision. In the present case, no such circumstances have been pointed out by the assessee either before the AO or before CIT(A). The only statement made is that it was a bona fide human error. This is a very general and sweeping statement. It should be demonstrated with circumstantial evidence as to how this error has happened; what is operating force in the mind of person who has prepared the return, and how he failed to comprehend a particular item. Even the affidavit of that person has not been filed. Therefore, we are of the view that this statement is just being made for giving an explanation - Decided against assessee. - ITA No.533/Ahd/2014 - - ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ld.AO accordingly made addition of the capital gain to the total income of the assessee and reworked out loss. He initiated penalty proceedings under section 271(1)(c) of the Act and issued a notice under section 274 r.w.s. 271(1)(c) of the Act inviting explanation of the assessee as to why penalty under the above provision should not be imposed upon it. In response to the query of the AO, the assessee submitted its reply which has been reproduced in para 4 of the impugned penalty order. The ld.AO thereafter imposed penalty of ₹ 4,26,960/- for furnishing inaccurate particulars of income. Appeal to the ld.CIT(A) did not bring any relief to the assessee. 4. Before us, the ld.counsel for the assessee while impugning order of the ld.CI ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... l pay by way of penalty. ( i)and (Income-tax Officer,)** ** ** ( iii) in the cases referred to in Clause (c) or Clause (d), in addition to tax, if any, payable by him, a sum which shall not be less than, but which shall not exceed three times, the amount of tax sought to be evaded by reason of the concealment of particulars of his income or fringe benefit the furnishing of inaccurate particulars of such income or fringe benefits: Explanation 1- Where in respect of any facts material to the computation of the total income of any person under this Act, ( A) Such person fails to offer an explanation or offers an explanation which is found by the Assessing Officer or the Commissioner (Appeals) or the CIT ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , by way of Explanation I to section 271(1)(c) postulates two situations; (a) first whether in respect of any facts material to the computation of the total income under the provisions of the Act, the assessee fails to offer an explanation or the explanation offered by the assessee is found to be false by the Assessing Officer or Learned CIT(Appeal); and, (b) where in respect of any fact, material to the computation of total income under the provisions of the Act, the assessee is not able to substantiate the explanation and the assessee fails, to prove that such explanation is bona fide and that the assessee had disclosed all the facts relating to the same and material to the computation of the total income. Under first situation, the deemi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r took place while computing the total income of the year. The appellant has also stated that keeping in mind the heavy accumulated business loss and depreciation, there was no tax liability on the part of the appellant had it disclosed the short term capital gain u/s 50 of the Act while filing the tax return. This submission of the appellant is not correct- as the appellant had short term capital gain on sale of assets at ₹ 12,77,357/-. The appellant had submitted before the AO that such short term capital gain was set off against the past carried forward unabsorbed business and depreciation loss as per the provisions of the Section 72 of the Act. It may be noted here that short term capital gain of current year can be set off agains ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nt or bona fide mistake. In the case of Price Waterhouse Coopers Pvt. Ltd vs. CIT (supra) a provision for gratuity etc. was made for the regular and adhoc employees. In the audit report, it was pointed by the auditor that provision for adhoc employees was required to be written back. But somehow, while filing the return, accountant failed to add back that amount. An affidavit of the concerned person was filed and it was pointed out that more than thousands of employees were working in that concern. In that background, it was construed as bona fide human error i.e. failure to add back a particular provision. In the present case, no such circumstances have been pointed out by the assessee either before the AO or before the ld.CIT(A). The only ..... X X X X Extracts X X X X X X X X Extracts X X X X
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