9911796707
TMI Blog2022 (3) TMI 842X X X X Extracts X X X X X X X X Extracts X X X X ..... sment year under dispute, assessee filed its return of income on 31.10.2015 declaring nil income after set off of loss. As alleged by the Assessing Officer, since the assessee failed to comply with the statutory notices issued under Section 142(1)/142(3) of the Income-tax Act, 1961, he proceeded to complete the assessment under Section 144 of the Act, to the best of his judgment, by making a number of additions. As a result of which, the total income was determined at Rs. 73,77,968. The assessee contested the additions made by the Assessing Officer by filing an appeal before learned Commissioner (Appeals). While deciding the appeal, learned Commissioner (Appeals) granted substantial relief to the assessee by deleting most of the additions m ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mitted, once the interest was debited to assessee's OD account, the OD limit to that extent gets reduced. He submitted, assessee has also increased its liability to that extent in the balance sheet. He submitted, since all information relating to the interest charged on OD account has been furnished, the assessee cannot be accused of furnishing inaccurate particulars of income. He submitted, at best, the assessee has made a bona fide claim which was not accepted by the revenue. Therefore, no penalty under Section 271(1)(c) of the Act can be imposed. 4. We have considered the rival submissions and perused the material available on record. Undisputedly, assessee has debited the interest charged to its OD account by the bank to its profit and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... imposed. In the facts of the present appeal, in our considered opinion, the deduction claimed by the assessee is not due to any mala fide intention but on a bona fide belief. In any case of the matter, as held by the Hon'ble Supreme Court in case of CIT vs. Reliance Petro Products (322 ITR 82), disallowance of a deduction claimed by the assessee by itself cannot lead to furnishing of any inaccurate particulars of income. Applying the aforesaid legal principle, we hold that it is not a fit case for imposition of penalty under Section 271(1)(c) of the Act. Accordingly, we delete the penalty imposed.
6. In the result, the appeal is allowed.
Order pronounced in the open court on 11th March, 2022 X X X X Extracts X X X X X X X X Extracts X X X X
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