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TMI Blog2025 (5) TMI 699X X X X Extracts X X X X X X X X Extracts X X X X ..... rder u/s. 250 dated 15.03.2024 in the mail address updated in portal. This was later discovered in his portal by his Authorized Representative by end of August 2024 while uploading his return of income. Thereafter some time passed in communicating to him and taking decision to file appeal. From the time the order u/s. 250 dated 15.03.2024 was identified, all steps were taken on urgent basis and the appeal is arranged to be filed. Due to absence of assessee from India and professional preoccupation of Chartered Accountant handling the matter the appeal before ITAT could not be filed earlier. The assessee was not negligent, careless, capricious or had no malafide or dilatory intention to delay any proceedings under the tax laws. Due to late receipt of information, the time gap between date of order and date of filing of appeal arises. There being reasonable cause for delay in filing of this appeal as compared from the date of the appeal order, the assessee prays for condonation of the delay in filing of this appeal. In case the delay is not condoned, the assessee will suffer irreparable loss and prejudice whereas in case the delay is condoned, no public policy will be prejudiced." 1 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nd the assessment was made treating the same as 'income from other source'. Aggrieved with the assessment order, the assessee preferred an appeal before the Ld. CIT(A), who vide order dated 14.03.2024 deleted the addition of Rs. 23,00,188/- and the appeal was partly allowed. Subsequently, penalty under section under section 271(1)(c) of the Act was imposed at Rs. 6,90,178/-. Aggrieved with the penalty order, the assessee preferred an appeal before the Ld. CIT(A), who vide order dated 15.03.2024 restricted the penalty to 100% of the tax sought to be evaded on the income of Rs. 8,00,190/- and the appeal was partly allowed. Aggrieved with the order of the Ld. CIT(A), the assessee has filed the appeal before the Tribunal. 4. Rival submissions were heard and the record and the submissions made have been examined. During the course of the hearing, the Ld. AR drew our attention to the show cause notice issued u/s 274 r.w.s. 271(1)(c) of the Act by the Assessing Officer (hereinafter referred to as ld. 'AO') which is reproduced as under: "Notice for Penalty under section 274 read with section 271(1)(c) of Income-tax Act, 1961 3. You are required to submit your reply online elec ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... previous year paid or deposited any amount out of his income chargeable to tax to effect or keep in force a contract for any annuity plan of Life Insurance Corporation of India or any other insurer for receiving pension from the fund referred to in clause (23AAB) of section 10, he shall, in accordance with, and subject to, the provisions of this section, be allowed a deduction in the computation of his total income, of the whole of the amount paid or deposited (excluding interest or bonus accrued or credited to the assessee's account, if any) as does not exceed the amount of one hundred and fifty thousand rupees in the previous year. (2) Where any amount standing to the credit of the assessee in a fund, referred to in sub-section (1) in respect of which a deduction has been allowed under sub-section (1), together with the interest or bonus accrued or credited to the assessee's account, if any, is received by the assessee or his nominee- (a) on account of the surrender of the annuity plan whether in whole or in part, in any previous year, or (b) as pension received from the annuity plan, an amount equal to the whole of the amount referred to in clause (a) or clause ( ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on account of withdrawal: * Any amount standing to the credit of the assessee in a fund, referred to in sub section (1) in respect of which a deduction has been allowed under sub section (1) and * The interest or bonus accrued or credited to the assessee's account (emphasis supplied) 5.5 Even though the assessee has failed to file ITR under section 139(1) of the Act for the Assessment year under consideration, but in response to notice u/s. 148 of the Act the assessee has filed an ITR declaring a total income of Rs. 8,00,188/- being the interest or bonus etc., credited to the assessee's account of the said policy. However, the assessee contends that he had not filed any ITR for AYs 2011-12,2012-13, 2013-14 and accordingly has neither claimed nor was allowed any deduction uls.80CCC(1) of the Act. 5.6 Under the facts and circumstances of the case, there is merit in appellant's ground that the investments of Rs. 5,00,000/- each made by him in the said policy, during the F.Ys. 2010-11, 2011-12 and 2012-13 cannot be brought to tax for the year under consideration i.e., A.Y. 2016-17. Further, it is seen that the AO has made an addition of the total surrendered value ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the material on record. It is an undisputed fact that the returned income has been accepted, there is no satisfaction recorded by the assessing officer that assessee had concealed income with reference to return of income filed by him in response to notice u/s 148. Hon'ble Supreme Court in Varkey Chacko v. CIT [1993] 203 ITR 885 has held that a penalty for concealment of particulars of income or for furnishing inaccurate particulars of income can be imposed only when the assessing authority is satisfied that there has been such concealment or furnishing of inaccurate particulars. A penalty proceeding, therefore, can be initiated only after an assessment order has been made which finds such concealment or furnishing of inaccurate particulars. The penalty was permissible under the law on the date on which the offence of concealment of income was committed, that is to say, on the date of the offending return. Hon'ble Madras High Court in the case of CIT v. K.R. Chinni Krishna Chetty [2000] 246 ITR 121 has held that under section 271(1)(c) of the Act the authority is given the discretion to levy a penalty if there is concealment of particulars of income and even as regards the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Mumbai in ITA Nos. 3299, 3300 & 3301/Mum/2017 for A.Ys. 2009-10 to 2011-12, vide order dated 1st January, 2019, wherein it has been held as under: - "7. In this case, since the assessed income and the returned income are the same, the machinery provision of penalty u/s 271(1)(c) fails. In this regard, we draw support from the of Hon'ble Delhi High Court decision in the case of CIT vs. SAS Pharmaceuticals [2011] 335 ITR 259 (Del). The Hon'ble High Court has expounded that penalty u/s 271(1)(c) can only be levied if in the course of proceedings, the A.O. is satisfied that there is an concealment or furnishing of inaccurate particulars. The words "in the course of any proceedings under this Act mean the assessment proceedings". However, the question 'whether there is concealment or inaccurate particulars' has to be determined with reference to the returned income. Accordingly, in the background of the aforesaid discussion and precedent, we set aside the order of the Ld. CIT(A) and delete the levy of penalty." Hence, in view of the finding in the case of Meeta Gutgutia (supra), in which reliance has been placed on the decision of Hon'ble Supreme Court in the cas ..... X X X X Extracts X X X X X X X X Extracts X X X X
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