INCOME TAX ACT, 1961

Section 271(1)(c)

Penalty under section 271(1)(c) - Concealment or furnishing of inaccurate particulars - AO not certain about charge at the time of initiation of penalty proceedings but definite finding recorded at the time of passing of penalty order - Assessee having no case on merits

AO on perusal of details shown in form 26AS purhases noticed that assessee in the books of account had shown purchases which was less to the tune of Rs. 6 lakhs. Accordingly AO made an addition of said amount as unexplained source of purchases and said addition attained finality as assessee did not challenge the same. AO accordingly levied penalty under section 271(1)(c). Assessee challenged this on the ground of levy of penalty on mere disallowance made in assessment proceedings and further non-specification of particular charge of offence in penalty notice.Held: It was not a case claim of deduction by assessee which was not allowed by AO but it was a case of concealment of certain transactions thereby assessee had suppressed purchases recorded in books of accounts. This fact was detected by the AO when he has examined the details given in form 26AS and the facts as found by AO in Form 26As were never disputed by assessee. Therefore, assessee had no case on merits of levy of penalty under section 271(1)(c) and even if AO was not certain about charge of offence at the time of initiation of penalty proceedings but he had given a definite conclusive finding regarding default or charge at the time of passing of penalty order and accordingly, there was no illegality in the penalty order passed under section 271(1)(c). Accordingly, levy of penalty was sustained.

Relied:HPCL Mittal Energy Ltd. v. ACIT 97 Taxmann.com 3 : ITA Nos. 554 &555/Asr/2014 : 2018 TaxPub(DT) 5812 (Asr-Trib). Distinguished:CIT v. Reliance Petroproducts (P) Ltd. (2010) 322 ITR 158 (SC) : 2010 TaxPub(DT) 1683 (SC).

REFERRED :

FAVOUR : Against the assessee.

A.Y. : 2015-16

INCOME TAX ACT, 1961

Section 253(5)

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