Home Income tax Corporate Income tax Tax Penalty U/S of 271(1)(c) is Not Possible When the Information Was Inaccurate

Tax Penalty U/S of 271(1)(c) is Not Possible When the Information Was Inaccurate

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Tax Penalty U/S of 271(1)(c) is Not Possible When the Information Was Inaccurate
Delhi HC's Order for M/S Blackroak Securities Pvt Ltd

Underneath part 271(1)(c) of the Earnings Tax Act, 1961 Delhi Excessive Court docket penalty isn’t attainable merely when the furnishing of inaccurate particulars was confirmed. beneath Part 271(1)(c) of the Act a case the place the particular person is required to point out clearly as to which limb of the acknowledged provision is drawn.

The order handed by the Earnings Tax Appellate Tribunal is been challenged by the appellant/income. The Tribunal, via the impugned order, had put aside the findings of the Commissioner of Earnings Tax (Appeals) and directed the Assessing Officer (AO) to delete the penalty amounting to Rs. 7,99,90,570.

In setting apart the order of the CIT(A) the explanation given by the Tribunal was that the AO on the time of initiating penalty proceedings beneath Part 271(1)(c) of the Act, will need to have indicated to the limb beneath which penalty is recommended to be charged.

AO should stipulate as as to if the penalty was requested to be charged on M/S Blackroak Securities Pvt Ltd, the respondent/taxpayer for concealment of particulars of its earnings, or offering the inaccurate particulars.

Within the impugned order, the Tribunal famous that “because the aforesaid additions had been handled as concealment of earnings/offering the mistaken particulars of earnings by the taxpayer, a discover beneath part 274 r.w.s. 271 (1)(c) of the Earnings Tax Act 1961 dated 28.12.2016 and 14.06.2017 had been issued and duly served -upon the taxpayer’s firm.

The AR of the taxpayer firm filed its response to the discover vide letter on 23.06.2016. The penalty proceedings beneath part 271(1) (c) are determined established on the earnings tax provisions, pronouncements judicial, and the fabric accessible on document and the submission of the taxpayer.”

The Tribunal has permitted the enchantment that the taxpayer filed holding the discover furnished by way of the Assessing Officer beneath Part 274 learn with Part 271(1)(c) of the Earnings Tax Act, 1961 ( ‘the Act’) to be dangerous in regulation because it didn’t specify which limb of Part 271(1)(c) of the Act, the penalty proceedings had been began i.e., whether or not for concealment of info of earnings or offering the mistaken earnings particulars.

A case is made out beneath Part 271(1)(c) of the Act, he’s required to point out transparently as to which limb of the acknowledged provision is drawn, noticed by the division bench comprising Justice Rajiv Shakdher and Justice Girish Kathpalia. The trigger could also be that past anything the monetary burden is likely to be totally different as per the infraction(s) executed by way of respondent or taxpayer. The enchantment was closed by the court docket.

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