Mahavir Ispat Private Ltd. v. ITO

INCOME TAX ACT, 1961

--Penalty under section 271(1)(c)--Concealment of income or furnishing of inaccurate particulars of IncomeAddition of share capital from directors and the minors--Assessee was engaged in the business of manufacture and sale of steel ingots. Search was conducted on his premises and assessee filed return, AO made addition of share application money as entire share application money was from directors or from their minor children and levied penalty for concealment. CIT(A) accepted genuineness to the extent of Investments made by directors as they were income tax assessee and confirmed addition to the extent of investment made by minors. Assessee did not prefer further appeal due to amount being small. Held: Non filing of appeal due to tax incidence being small does not mean that there was concealment of income, so as to attract section 271(1)(c). Mere disallowance in assessment or addition could not automatically attract 271(1)(c) unless conditions therefore were satisfied. Further, all the necessary details were furnished by assessee hence there was no furnishing of inaccurate particulars and section 271(1)(c) was not attracted to the case.