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TMI Blog2021 (9) TMI 237X X X X Extracts X X X X X X X X Extracts X X X X ..... law, the learned Commissioner of Income-tax (Appeals) [ CIT (A)] erred in confirming the Order of the learned Assessing Officer, imposing/ levying penalty under Section 271(l)(c) of the Act at Rs. 5,39,56,443/- on the ground that the appellant had furnished inaccurate particulars of income and thereby concealed income in respect of alleged wrong claim of deemed income under Section 11(3) of the Act. 1.2 The learned CIT (A) and the learned Assessing Officer failed to appreciate the legal position emerging from and rule of law laid down in various judicial pronouncements and the submissions made/explanation offered by the appellant. 1.3 It is submitted that the Notice under Section 274 read with Section 271(l)(c) of the Act issued by t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... further noticed dated 3/3/2014 was also issued to the assessee. In response to the notice the Authorized Representative of the assessee vide letter dated 12/3/2014 submitted the reply thereby relying on the decision of the Hon'ble Supreme Court in case of CIT Vs. Reliance Petro Product Pvt. ltd. 322 ITR 158 (S.C) contending therein that penalty u/s 271(1)(c) is not leviable as it has not concealed any facts nor it has furnished any inaccurate particulars of income. The Assessing Officer held that the assessee made wrong claim in respect of taxable income thereby furnished inaccurate particulars of income and concealed its income within the meaning of Section 271(1)(c) of the Income Tax Act, 1961. 4. Being aggrieved by the assessment or ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ve got utilized to the extent of Rs. 20 Crores, thus, the Provisions of Section 11(3) (c)/11(3) (d) of the Act got attracted. In view of the above, the assessee computed revised return of income under revised statement of computation of total income for the above year and has offered to tax the said deemed income u/s 11(3) of the Act. The Ld. AR further pointed out that the assessee also paid the tax of Rs. 7,75,69,270/- payable as per the said revised statement of computation of total income. The Ld. AR submitted that the assessee has field the revised return of income for the present Assessment Year on its own account and voluntarily being pointed out by the AO in any notice in this behalf. Thus, the assessee trust has made bonafide claim ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Tax Act, 1961, the assessee is liable for penalty. Besides that the Assessment Order also did not specify the charge as to whether there is concealment of income or furnishing of inaccurate particulars of income in assessee's case. The notice issued u/s 271 (1)(c) read with Section 274 was not as per the prescribed provisions of penalty envisaged in Income Tax Act. This issue is squarely covered by the decision of the Hon'ble Supreme Court in case of M/s SSA' Emerald Meadow. The extract of the decision of the Hon'ble Karnataka High Court in M/s SSA' Emerald Meadows are as under which was confirmed by the Hon'ble Apex Court: "3. The Tribunal has allowed the appeal filed by the assessee holding the notice issued by the Assessing Officer und ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f the inappropriate words will not invalidate the penalty proceedings, however, the decision of the Hon'ble Karnataka High Court in the case of SSA'S Emerald Meadows (supra) where the SLP filed by the Revenue has been dismissed by Hn'ble Apex Court is directly on the issue contested herein by the Assessee. Further, when the notice is not mentioning the concealment or the furnishing of inaccurate particulars, the ratio laid down by the Hon'ble Delhi High Court in case of M/s. Sahara India Life Insurance Company Ltd. (supra) will be applicable in the present case. The Hon'ble Delhi High Court held as under: "21. The Respondent had challenged the upholding of the penalty imposed under Section 271(1)(c) of the Act, which was accepted by the I ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the claim, which is not sustainable in law, by itself, will not amount to furnishing inaccurate particulars regarding the income of the assessee. Such claim made in the Return cannot amount to the inaccurate particulars. 19. It was tried to be suggested that Section 14A of the Act specifically excluded the deductions in respect of the expenditure incurred by the assessee in relation to income which does not form part of the total income under the Act. It was further pointed out that the dividends from the shares did not form the part of the total income. It was, therefore, reiterated before us that the Assessing Officer had correctly reached the conclusion that since the assessee had claimed excessive deductions knowing that they are in ..... X X X X Extracts X X X X X X X X Extracts X X X X
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