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The Tax Publishers2019 TaxPub(DT) 6850 (Bom-HC) INCOME TAX ACT, 1961
Section 271(1)(c)
Mere making of claim, which is not sustainable in law, by itself, will not amount to furnishing of inaccurate particulars of income, so as to impose penalty under section 271(1)(c).
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Penalty under section 271(1)(c) - Validity - Automatic imposition of penalty, whether justified on account of making an incorrect claim -
Assessee was subjected to penalty under section 271(1)(c) for claiming an expenditure under section 37 that was not incurred to earn the relevant income in relevant previous year. Held: Mere making of claim, which is not sustainable in law, by itself, will not amount to furnishing of inaccurate particulars of income. Therefore, mere making of a claim which is disallowed in quantum proceedings, cannot by itself be a ground to impose penalty under section 271(1)(c).
REFERRED : CIT v. Reliance Petroproducts Pvt. Ltd. (2010) 322 ITR 158 (SC) : 2010 TaxPub(DT) 1683 (SC) and Lokhandwala Construction Industries (P.) Ltd. v. Dy. CIT-9 (2) [ITA No. 4403/MUM/2013, dt. 29-4-2016]
FAVOUR : In assessee's favour
A.Y. :
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