The Asst.CIT, Cir-3(2), Hyderabad V. M/s Sushee Infra Private Limited, Hyderabad

ITA 22/HYD/2013

• Counselvise Citation: [2013] 120 COUNSELVISE.COM (IT) 4811 (ITAT-HYDERABAD)
• Duration Of Justice: 7 month(s) 19 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 23-08-2013
• Appeal Filed By: Department
• Order Result: Allowed
• Bench Allotted: A
• Assessment Year: 2006-2007
• Appeal Filed On: 04-01-2013
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: P SOMASEKHAR REDDY
• Assessee Lawyers: S RAMA RAO
• Keywords: Retrospective amendment; Difference of opinion; Revised return
• Section: 133A

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD BENCH A : HYDERABAD BEFORE SHRI B.RAMAKOTAIAH, ACCOUNTANT MEMBER AND SHRI SAKTIJIT DEY, JUDICIAL MEMBER ITA.NO.22/HYD/2013 ASSESSMENT YEAR 2006-2007 ACIT, CIRCLE 3(2) HYDERABAD. VS. M/S. SUSHEE INFRA P. LTD. (FORMERLY SUSHEE HI TECH CONSTRUCTIONS PVT. LTD.) HYDERABAD 500 034. PAN AACCS-8560-Q (APPELLANT) (RESPONDENT) FOR REVENUE : MR. P. SOMASEKHAR REDDY FOR ASSESSEE : MR. S. RAMA RAO DATE OF HEARING : 15.05.2014 DATE OF PRONOUNCEMENT : 28.05.2014 ORDER PER B. RAMAKOTAIAH, A.M. THIS APPEAL BY REVENUE IS DIRECTED AGAINST THE ORDER OF THE CIT(A)-IV, HYDERABAD DATED 25.10.2012, DELETING THE PENALTY LEVIED BY THE ASSESSING OFFICER UNDER S ECTION 271(1)(C) OF THE ACT FOR THE ASSESSMENT YEAR 2006-0 7 TO THE EXTENT OF RS.6,22,06,373/-. 2. THE APPEAL WAS DISPOSED OF BY THE ITAT VIDE ORD ER DATED 23.08.2013 SETTING ASIDE THE CIT(A) ORDER AND RESTORING THE PENALTY LEVIED BY A.O. THEREON, ASSESSEE PREFER RED A M.A. SUBMITTING THAT THE ARGUMENTS RAISED AND CASE LAW R ELIED ON AND FACTS OF THE CASE WERE NOT CONSIDERED PROPERLY. THE CONTENTIONS OF THE ASSESSEE WERE ACCEPTED AND THE O RDER DATED 23.08.2013 WAS RECALLED AND THE APPEAL WAS POSTED A GAIN FOR FRESH HEARING. 2 ITA.NO.22/HYD/2013 M/S. SUSHEE INFRA PVT. LTD. HYDERABAD . 3. FACTS OF THE CASE IN BRIEF ARE THAT THE ASSESS EE, A COMPANY ENGAGED IN THE BUSINESS OF EXECUTION OF CIV IL CONTRACTS, FILED ITS RETURN OF INCOME FOR THE ASSE SSMENT YEAR 2006-07 ON 27.11.2006 DECLARING A TOTAL INCOME OF RS.1,11,25,082, AFTER CLAIMING DEDUCTION UNDER SECT ION 80IA OF RS.18,48,08,000. IN THIS CASE, A SURVEY UNDER SECT ION 133A OF THE ACT WAS CONDUCTED ON 25.8.2008. IN THE COURSE OF THE SAID SURVEY, IT CAME TO LIGHT THAT TURNOVER OF THE ASSES SEE COMPANY INCLUDES CONTRACTS EXECUTED THROUGH SUB-CONTRACTS A MOUNTING TO RS.241.57 CRORES. AS THE INCOME FROM SUB-CONTRA CTS IS NOT ELIGIBLE FOR DEDUCTION UNDER SECTION 80IA AS PER TH E AMENDMENT MADE BY THE FINANCE ACT, 2007 WITH RETROS PECTIVE EFFECT FROM 1.4.2000, THE ASSESSEE BECAME INELIGIBL E FOR DEDUCTION ON WORKS DONE ON SUB-CONTRACTS AND IN THE SWORN STATEMENT RECORDED DURING THE COURSE OF SURVEY, THE ASSESSEE AGREED TO WITHDRAW THE CLAIM IN RELATION TO SUB-CON TRACT WORKS. ACCORDINGLY, THE ASSESSEE FURNISHED DURING THE COUR SE OF ASSESSMENT PROCEEDINGS, REVISED COMPUTATION OF INCO ME WITHDRAWING THE CLAIM FOR DEDUCTION UNDER SECTION 8 0IA ON SUB-CONTRACTS, AND OFFERED ADDITIONAL INCOME OF RS. 17.50 CRORES. THE ASSESSEE THUS, IN THE REVISED COMPUTATI ON, CLAIMED UNDER DEDUCTION UNDER SECTION 80IA AT RS.93,18,184 ON THE WORKS UNDERTAKEN BY IT ON OWN CONTRACT WORKS. THE ASSESSING OFFICER NOTICING THAT THE ASSESSEE HAS NOT SATISFIE D THE CONDITIONS LAID DOWN FOR CLAIMING DEDUCTION UNDER S ECTION 80IA, DISALLOWED THE ENTIRE CLAIM OF THE ASSESSEE F OR DEDUCTION UNDER SECTION 80IA OF THE ACT, AND ACCORDINGLY COMP LETED THE ASSESSMENT ON A TOTAL INCOME OF RS.19,59,33,082, V IDE ORDER OF ASSESSMENT DATED 29.12.2008 FRAMED UNDER S.143( 3) OF THE ACT. WHILE THUS COMPLETING THE ASSESSMENT, HE ALSO INITIATED THE PROCEEDINGS FOR LEVY OF PENALTY UNDER SECTION 2 71(1)(C) OF 3 ITA.NO.22/HYD/2013 M/S. SUSHEE INFRA PVT. LTD. HYDERABAD . THE ACT. THE SAID DISALLOWANCE MADE BY THE ASSESSI NG OFFICER, HAS BEEN UPHELD BY THE CIT(A). 4. IN RESPONSE TO THE PENALTY NOTICE, THE ASSESSEE FILED ITS REPLY DATED 18.3.2012, STATING THAT THE I S NO CONCEALMENT OF INCOME AND THE ADDITION WAS MADE ONL Y EITHER BECAUSE THE AMENDMENT TO THE PROVISIONS OF THE LAW OR BECAUSE OF THE DIFFERENCE OF OPINION EXPRESSED BY T HE ASSESSING OFFICER, AND ACCORDINGLY THE PENALTY PROCEEDINGS SH OULD BE DROPPED. THE ASSESSING OFFICER DID NOT FIND MERIT I N THE CONTENTIONS OF THE ASSESSEE OBSERVING THAT THE ISSU E IS BEYOND THE AMENDMENT TO THE PROVISIONS OF LAW RELATING TO SECTION 80IA, SINCE THE ASSESSEE HAS NOT FULFILLED THE REQU ISITE CONDITIONS ENABLING IT FOR DEDUCTION UNDER SECTION 80IA OF THE ACT. WITH REGARD TO FILING OF THE REVISED RETURNS, RELIANCE WAS PLACED BY THE ASSESSING OFFICER ON THE RATIO LAID D OWN BY THE TRIBUNAL IN SIMILAR CASES, AND CONCLUDING THAT THE ASSESSEE COMPANY HAS DELIBERATELY FURNISHED INACCURATE PARTI CULARS OF INCOME TO THE EXTENT OF RS.18,48,08,000 BEING THE D ISALLOWANCE MADE BY THE ASSESSING OFFICER UNDER SECTION 80IA OF THE ACT, AND HELD THAT IT WAS A FIT CASE FOR LEVY OF PENALTY UNDER S.271(1)(C) OF THE ACT. THE ASSESSING OFFICER ACCOR DINGLY LEVIED A MINIMUM PENALTY OF RS . 6,22,06,373, VIDE ORDER OF PENALTY DATED 30.3.2011, PASSED UNDER SECTION 271(1)(C) OF THE ACT. 5. ON APPEAL, THE CIT(A), PLACING RELIANCE ON THE DECISION OF THE APEX COURT IN THE CASE OF RELIANCE PETRO PRODUCTS LTD.(322 ITR 158), DELETED THE PENALTY LEV IED UNDER S.271(1)(C) ON THE ACT, WITH THE FOLLOWING OBSERVAT IONS- 11. I HAVE CONSIDERED THE FACTS ON RECORD AND TH E SUBMISSIONS OF THE AR AND RELIED ON THE DECISION IN THE CASE OF RELIANCE PETRO PRODUCTS P LTD. 322 ITR 158 (SC) WHE REIN THE HONBLE SUPREME COURT HAS MADE THE FOLLOWING OBSERV ATIONS : 4 ITA.NO.22/HYD/2013 M/S. SUSHEE INFRA PVT. LTD. HYDERABAD . 'A GLANCE AT THE PROVISIONS OF SECTION 271(1)(C) OF THE INCOME-TAX ACT, 1961, SUGGESTS THAT IN ORDER TO BE COVERED BY IT, THERE HAS TO BE CONCEALMENT OF THE PARTICULARS OF THE INCOME OF THE ASSESSEE. SECONDLY, THE ASSESSEE MUST HAVE FURNISHED INACCURATE PARTICULARS OF HIS INCOME. THE MEANING OF THE WORD 'PARTICULARS' USED IN SECTION 271(10(C) WOULD EMBRACE THE DETAILS OF THE CLAIM MADE. WHERE NO INFORMATION GIVEN IN THE RETURN IS FOUND TO BE INCORRECT OR INACCURATE, THE ASSESSEE CANNOT BE HELD GUILTY OF FURNISHING INACCURATE PARTICULARS. IN ORDER TO EXPOSE THE ASSESSEE TO PENALTY, UNLESS THE CASE IS STRICTLY COVERED BY THE PROVISION, THE PENALTY PROVISION CANNOT BE INVOKED. BY NO STRETCH OF IMAGINATION CAN MAKING AN INCORRECT CLAIM TANTAMOUNT TO FURNISHING INACCURATE PARTICULARS . ... WHERE THERE IS NO FINDING THAT ANY DETAILS SUPPLIED BY THE ASSESSEE IN ITS RETURN ARE FOUND TO BE INCORRECT OR ERRONEOUS OR FALSE THERE IS NO QUESTION OF INVITING THE PENALTY UNDER SECTION 271 (1) (C). A MERE MAKING OF A CLAIM, WHICH IS NOT SUSTAINABLE IN LAW, BY ITSELF, WILL NOT AMOUNT TO FURNISHING INACCURATE PARTICULARS REGARDING THE INCOME OF THE ASSESSEE. SUCH A CLAIM MADE IN THE RETURN CANNOT AMOUNT TO FURNISHING INACCURATE PARTICULARS.' 12 APPLYING THE RATIO OF THE DECISION TO THE FACTS IN THE APPELLANTS CASE, IT IS SEEN THAT THE APPELLANT HAS PLACED THE FULL PARTICULARS OF ITS CLAIM BEFORE THE ASSESSING OFFICER. THERE IS NO INACCURACY OR FALSEH OOD IN THE INFORMATION FURNISHED IN THE RETURN NOR HAS THE APPELLANT CONCEALED ANY PARTICULARS. AS HELD BY THE SUPREME COURT, THE MERE MAKING OF AN INCORRECT CLAI M DOES NOT TANTAMOUNT TO FURNISHING INACCURATE PARTICULARS. 13. THERE IS NO DOUBT THAT THE APPELLANT WITHDREW ITS CLAIM OF DEDUCTION IN THE COURSE OF A SURVEY U/S. 133A. WHAT IS NOTEWORTHY, HOWEVER, IS THAT THE SURVEY HAS NOT BROUGHT TO LIGHT ANY FACT O R INFORMATION THAT WAS NOT ALREADY AVAILABLE ON RECOR D. THE FACT THAT PART OF THE CLAIM U/S. 80IA RELATED T O SUB-CONTRACTS HAD BEEN ADMITTED BY THE APPELLANT 5 ITA.NO.22/HYD/2013 M/S. SUSHEE INFRA PVT. LTD. HYDERABAD . ITSELF IN ITS COMPUTATION SUBMITTED IN ITS LETTER D ATED 30.11.2006 AND WAS NOT A FACT BROUGHT TO LIGHT AS A RESULT OF THE SURVEY. THE WITHDRAWAL OF ITS CLAIM I N THE COURSE OF THE SURVEY IS, THEREFORE, INCIDENTAL AND IMMATERIAL TO THE ISSUE. 14. INDEED, THE CLAIM WAS LIABLE TO REJECTION EVEN IF THERE HAD BEEN NO SURVEY OR EVEN IF THE APPELLANT H AD NOT ACTUALLY WITHDRAWN THE CLAIM. HOWEVER, AS HELD BY THE SUPREME COURT, THE MERE REJECTION OF THE CLA IM IRRESPECTIVE OF ATTENDANT CIRCUMSTANCES, DOES NOT QUALIFY AS CONCEALMENT OR FURNISHING OF A INACCURAT E PARTICULARS, WARRANTING LEVY OF PENALTY. 6. AGGRIEVED BY THE ABOVE ORDER OF THE CIT(A) GRAN TING RELIEF TO THE ASSESSEE, REVENUE PREFERRED THE PRESE NT APPEAL BEFORE US. 7. THE LEARNED DEPARTMENTAL REPRESENTATIVE, STRONGLY SUPPORTING THE ORDER OF THE ASSESSING OFFI CER, SUBMITTED THAT THE CIT(A) WAS NOT JUSTIFIED IN DELE TING ANY PART OF THE PENALTY IMPOSED BY THE ASSESSING OFFICER. TH E LEARNED DEPARTMENTAL REPRESENTATIVE SUBMITTED THAT IT IS NO T A CASE OF MERE DISALLOWANCE OF A CLAIM MADE BY THE ASSESSEE, BUT THE QUESTION IS WHETHER THE CLAIM MADE BY THE ASSESSEE IS PERMISSIBLE UNDER LAW OR NOT. THAT BEING SO, ASSES SEE IS CLEARLY GUILTY OF FURNISHING INACCURATE PARTICULARS OF INCOME, IF THE CLAIM MADE BY THE ASSESSEE FOR A PARTICULAR DED UCTION IN THE STATEMENT OF COMPUTATION IS NOT PERMISSIBLE UND ER LAW, NOTWITHSTANDING THE FACT THAT THE ASSESSEE SUBSEQUE NTLY FILED A REVISED COMPUTATION, AFTER THE SAME HAS BEEN DISCOV ERED IN THE COURSE OF SURVEY, AND SURRENDERED THE DEDUCTION CLA IMED UNDER SECTION 80IA OF THE ACT IN RELATION TO THE SU B-CONTRACT WORKS. THE LEARNED DEPARTMENTAL REPRESENTATIVE REL IED ON THE DECISION OF THE HYDERABAD BENCH OF THE TRIBUNAL IN THE CASE OF SAGI RAMARAJU & CO. VS. ITO(42 ITD 480), WHEREIN I T WAS HELD 6 ITA.NO.22/HYD/2013 M/S. SUSHEE INFRA PVT. LTD. HYDERABAD . THAT REVISED RETURN FILED WOULD NOT ABSOLVE THE ASS ESSEE FROM THE CONSEQUENCE OF PENALTY UNDER SECTION 271(1)(C) OF THE ACT. HE ALSO RELIED ON THE ORDER OF THE TRIBUNAL IN THE CASE OF GVK PETRO-CHEMICALS (ITA NO.433/HYD/2000), WHEREIN IT W AS HELD THAT FILING OF REVISE RETURN ON BEING CONFRONTED WI TH THE INEVITABLE CANNOT BE TAKEN AS A VALID PLEA BY THE A SSESSEE FOR NON-IMPOSITION OF PENALTY. 8. THE LEARNED COUNSEL FOR THE ASSESSEE ON THE OT HER HAND, STRONGLY RELIED ON THE ORDER OF THE CIT(A) AN D SUBMITTED THAT THOUGH THE ASSESSEE CLAIMED DEDUCTION UNDER SE CTION 80IA OF THE ACT, BOTH IN RELATION TO WORKS EXECUTE D ON OWN ACCOUNT AS WELL AS ON SUB-CONTRACT WORKS, HOWEVER, IMMEDIATELY AFTER FILING THE RETURN WITHIN DAYS ASS ESSEE SUBMITTED FACTS AND INFORMATION RELATING TO ITS CLA IM UNDER SECTION 80IA IN ITS LETTER DATED 30.11.2006, AND TH ERE WAS NO EXPRESS BAR ON SUCH CLAIM UNDER SECTION 80IA AT THA T POINT OF TIME. INVITING OUR ATTENTION TO THE ORDER OF THE T RIBUNAL IN QUANTUM PROCEEDINGS, IT IS SUBMITTED THAT THE TRIBU NAL TOOK NOTE OF THE FACT THAT AMENDMENT TO THE PROVISIONS O F SECTION 80IA, BY INSERTION OF EXPLANATION THERE UNDER, WAS NECESSITATED BY THE CONTRARY JUDICIAL DECISIONS ON THAT ISSUE. IN THE CIRCUMSTANCES, IT IS SUBMITTED THAT THE ASSE SSEE WAS UNDER A BONA FIDE BELIEF AS TO THE ADMISSIBILITY OF ITS CLAIM FOR DEDUCTION UNDER SECTION 80IA OF THE ACT EVEN IN RES PECT OF SUB- CONTRACT WORKS, AS IT WAS SUPPORTED BY JUDICIAL PRONOUNCEMENTS IN ITS FAVOUR ON THE ISSUE IN QUESTI ON. 9. THE LEARNED COUNSEL FOR THE ASSESSEE FURTHER SUBMITTED THAT IT IS AN UNDISPUTED FACT THAT THE AS SESSEE HAS DISCLOSED FULLY ALL THE RELEVANT FACTS RELATING TO ITS CLAIM FOR DEDUCTION UNDER SECTION 80IA IN ITS RETURN. THE SUR VEY 7 ITA.NO.22/HYD/2013 M/S. SUSHEE INFRA PVT. LTD. HYDERABAD . CONDUCTED BY THE DEPARTMENT DID NOT BRING TO LIGHT ANY FACT OR INFORMATION THAT HAS NOT BEEN DISCLOSED BY THE ASSE SSEE IN THE RETURN. HE ALSO REFERRED TO THE OBSERVATIONS OF TH E CIT(A) IN THE IMPUGNED ORDER ON THIS ASPECT. IT IS FURTHER SUBMIT TED THAT THE SEQUENCE OF EVENTS RIGHT FROM THE DATE OF FILING OF THE RETURN FOR ASSESSMENT YEAR 2006-07, VIZ. 27 TH NOVEMBER, 2006 TO THE DATE OF PASSING OF THE ASSESSMENT ORDER FOR THE ASSESS MENT YEAR 2005-06, WHICH IS 28 TH DECEMBER, 2007, CLEARLY ESTABLISH THE BONA FIDE ACTION OF THE ASSESSEE. 10. THE LEARNED COUNSEL FOR THE ASSESSEE SUBMITTED THAT THE RETROSPECTIVE AMENDMENT TO THE PROVISIONS OF SECTION 80IA WAS NOT ENACTED BY THE DATE OF FILING OF THE R ETURN BY THE ASSESSEE, AND ON THE OTHER HAND THERE WAS CLEAVAGE OF JUDICIAL OPINION WITH CONTRARY DECISIONS OF VARIOUS HIGH COU RTS ON ISSUE. FOR THAT MATTER, THE DEPARTMENT ITSELF DID NOT CONSIDER A SIMILAR DISALLOWANCE FOR THE ASSESSMENT YEAR 2005 -06 OR AS A FIT CASE FOR INITIATION OF PENAL PROCEEDINGS. IMM EDIATELY AFTER FILING ITS RETURN, THE ASSESSEE FILED LETTER DATED 30.11.2006 FURNISHING ALL THE FACTS AND INFORMATION RELATING T O ITS CLAIM FOR DEDUCTION UNDER SECTION 80IA AND NONE OF THE PARTIC ULARS WERE FOUND TO BE INACCURATE LATER ON. CONSEQUENTLY, IT WAS SUBMITTED THAT THE ASSESSEE CANNOT BE CHARGED WITH FURNISHING OF INACCURATE PARTICULARS. 11. THE LEARNED COUNSEL FOR THE ASSESSEE PLACED RELIANCE ON THE FOLLOWING DECISIONS IN SUPPORT OF T HE ABOVE CONTENTION, AND PLEADED THAT IT IS NOT A FIT CASE F OR LEVY OF PENALTY UNDER SECTION 271(1)(C) AND ACCORDINGLY, TH E IMPUGNED ORDER OF THE CIT(A) SHOULD BE UPHELD. 8 ITA.NO.22/HYD/2013 M/S. SUSHEE INFRA PVT. LTD. HYDERABAD . (A) CIT V/S. HARSHAVARDHAN CHEMCIALS AND MINERAL LTD. (259 ITR 212)-RAJ. (B) NAVBHARAT ENTERPRISES (P)LTD., V/S. ACIT(309 ITR (AT) 79) (C) CIT V/S. HP STATE FOREST CORPORATION LTD. (340 ITR 204)-HP (D) CIT V/S. RELIANCE PETRO-PRODUCTS PVT. LTD. (322 ITR 158)-SC THE LEARNED COUNSEL FOR THE ASSESSEE ALSO RELIED ON THE DECISION OF THE TRIBUNAL IN THE CASE OF OCEAN SPARKLE LIMITE D V/S. DCIT-(2006)99 TTJ 582, AS PER WHICH THE ASSESSEE IS ENTITLED FOR DEDUCTION UNDER SECTION 80IA EVEN IN RESPECT OF SUB- CONTRACT WORKS. 12. AFTER CONSIDERING THE RIVAL CONTENTIONS AND PERUSING THE FACTS ON RECORD, WE AFFIRM THE ORDER O F CIT(A). THE SEQUENCE OF EVENTS AS DETAILED HEREUNDER FORTIFY TH E CONTENTIONS OF ASSESSEE. DATE OF FILING OF RETURN OF INCOME FOR A.Y. 2006-07 27 TH NOVEMBER, 2006 DATE OF FILING LETTER WITH DETAILS OF DEDUCTION UNDER SECTION 80IA OWN CONTRACTS AND SUB-CONTRACTS. 30 TH NOVEMBER, 2006 RETROSPECTIVE AMENDMENT TO SECTION 80IA CLARIFYING SUB-CONTRACTORS ARE NOT ELIGIBLE FOR DEDUCTION UNDER SECTION 80IA FINANCE ACT, 2007 PASSED IN MAY 2007 AND CIRCULAR NO.3/2008 PARA 34. NOTICE UNDER SECTION 143(2) RECEIVED ON 30 TH JANUARY, 2008 SURVEY UNDER SECTION 133 25 TH AUGUST, 2008. REVISED STATEMENT OF INCOME FILED BY APPELLANT WITHDRAWING THE CLAIM UNDER SECTION 80IA ON SUB-CONTRACT WORK DURING THE COURSE OF ASSESSMENT PROCEEDINGS. ASSESSMENT ORDER 28 TH DECEMBER, 2008. 9 ITA.NO.22/HYD/2013 M/S. SUSHEE INFRA PVT. LTD. HYDERABAD . 13. ON THE DATE OF FILING OF RETURN OF INCOME, RETROSPECTIVE AMENDMENT DENYING THE CLAIM ON SUB-CO NTRACTS WAS NOT THERE. BASED ON VARIOUS JUDICIAL DECISIONS THEN EXISTING ASSESSEE MADE A CLAIM. ALL THE PARTICULARS REGARDING THE CLAIM WERE PLACED ON RECORD AND THERE IS NO DIS PUTE ON THAT. 14. THE ISSUE IS WHETHER THE CLAIM MADE AND SUBSEQUENTLY DENIED CAN LEAD TO PENALTY UNDER SECTI ON 271(1)(C). THE PENALTY UNDER SECTION 271(1)(C) CAN BE LEVIED ONLY WHEN THERE IS CONCEALMENT OF INCOME OR FURNISH ING OF INACCURATE PARTICULARS. THIS IS NOT A CASE BY REVEN UE THAT ASSESSEE HAD CONCEALED PARTICULARS OF INCOME. PENAL TY WAS LEVIED ON THE REASON OF FURNISHING OF INACCURATE P ARTICULARS. AS STATED ABOVE, ASSESSEE HAS FURNISHED ALL THE PAR TICULARS LEADING TO THE CLAIM OF DEDUCTION UNDER SECTION 80I A. 15. IT IS A CLAIM MADE BY ASSESSEE WHICH WAS DENIE D. ON SIMILAR FACTS, HONBLE SUPREME COURT HAS ANALYSE D THE PROVISIONS OF SECTION 271(1)(C) IN THE CASE OF RELI ANCE PETRO PRODUCTS 322 ITR 158 (SC) AND HELD AS UNDER : A GLANCE AT THE PROVISION OF S. 271(1)(C) WOULD SU GGEST THAT IN ORDER TO BE COVERED, THERE HAS TO BE CONCEALMENT OF THE PARTICULARS OF THE INCOME OF THE ASSESSEE. SECONDLY , THE ASSESSEE MUST HAVE FURNISHED INACCURATE PARTICULARS OF HIS INCOME. PRESENT IS NOT THE CASE OF CONCEALMENT OF T HE INCOME. THAT IS NOT THE CASE OF THE REVENUE EITHER. AS PER LAW LEXICON, THE MEANING OF THE WORD 'PARTICULAR' I S A DETAIL OR DETAILS (IN PLURAL SENSE); THE DETAILS OF A CLAIM, OR THE SEPARATE ITEMS OF AN ACCOUNT. THEREFORE, THE WO RD 'PARTICULARS' USED IN THE S. 271(1)(C) WOULD EMBRAC E THE MEANING OF THE DETAILS OF THE CLAIM MADE. IT IS AN ADMITTED POSITION IN THE PRESENT CASE THAT NO INFORMATION GI VEN IN THE RETURN WAS FOUND TO BE INCORRECT OR INACCURATE. IT IS NOT AS IF ANY STATEMENT MADE OR ANY DETAIL SUPPLIED WAS FOUND TO BE FACTUALLY INCORRECT. HENCE, AT LEAST, PRIMA FACIE, THE ASSESSEE CANNOT BE HELD GUILTY OF FURNISHING INACCU RATE 10 ITA.NO.22/HYD/2013 M/S. SUSHEE INFRA PVT. LTD. HYDERABAD . PARTICULARS. THE WORDS ARE PLAIN AND SIMPLE. IN ORD ER TO EXPOSE THE ASSESSEE TO THE PENALTY UNLESS THE CASE IS STRICTLY COVERED BY THE PROVISION, THE PENALTY PROV ISION CANNOT BE INVOKED. BY ANY STRETCH OF IMAGINATION, M AKING AN INCORRECT CLAIM IN LAW CANNOT TANTAMOUNT TO FURN ISHING INACCURATE PARTICULARS. THEREFORE, IT IS OBVIOUS TH AT IT MUST BE SHOWN THAT THE CONDITIONS UNDER S. 271(1)(C) MUS T EXIST BEFORE THE PENALTY IS IMPOSED. THERE CAN BE NO DISP UTE THAT EVERYTHING WOULD DEPEND UPON THE RETURN FILED BECAU SE THAT IS THE ONLY DOCUMENT, WHERE THE ASSESSEE CAN FURNIS H THE PARTICULARS OF HIS INCOME.CIT VS. ATUL MOHAN BINDA L (2009) 225 CTR (SC) 248 : (2009) 28 DTR (SC) 1 : (2 009) 9 SCC 589 FOLLOWED. (PARAS 7 & 8) READING THE WORDS 'INACCURATE' AND 'PARTICULARS' IN CONJUNCTION, THEY MUST MEAN THE DETAILS SUPPLIED IN THE RETURN, WHICH ARE NOT ACCURATE, NOT EXACT OR CORREC T, NOT ACCORDING TO TRUTH OR ERRONEOUS. IN THIS CASE, THER E IS NO FINDING THAT ANY DETAILS SUPPLIED BY THE ASSESSEE I N ITS RETURN WERE FOUND TO BE INCORRECT OR ERRONEOUS OR F ALSE. SUCH NOT BEING THE CASE, THERE WOULD BE NO QUESTION OF I NVITING THE PENALTY UNDER S. 271(1)(C). A MERE MAKING OF TH E CLAIM, WHICH IS NOT SUSTAINABLE IN LAW, BY ITSELF, WILL NO T AMOUNT TO FURNISHING INACCURATE PARTICULARS REGARDING THE INC OME OF THE ASSESSEE. SUCH CLAIM MADE IN THE RETURN CANNOT AMOUNT TO THE INACCURATE PARTICULARS. THE ASSESSEE HAD FUR NISHED ALL THE DETAILS OF ITS EXPENDITURE AS WELL AS INCOM E IN ITS RETURN, WHICH DETAILS, IN THEMSELVES, WERE NOT FOUN D TO BE INACCURATE NOR COULD BE VIEWED AS THE CONCEALMENT O F INCOME ON ITS PART. IT WAS UP TO THE AUTHORITIES TO ACCEPT ITS CLAIM IN THE RETURN OR NOT. MERELY BECAUSE THE ASSE SSEE HAD CLAIMED THE EXPENDITURE, WHICH CLAIM WAS NOT ACCEPT ED OR WAS NOT ACCEPTABLE TO THE REVENUE, THAT BY ITSELF W OULD NOT ATTRACT THE PENALTY UNDER S. 271(1)(C). IF THE CONT ENTION OF THE REVENUE IS ACCEPTED THEN IN CASE OF EVERY RETURN WH ERE THE CLAIM MADE IS NOT ACCEPTED BY AO FOR ANY REASON, TH E ASSESSEE WILL INVITE PENALTY UNDER S. 271(1)(C). TH AT IS CLEARLY NOT THE INTENDMENT OF THE LEGISLATURE. THE TRIBUNAL, AS WELL AS, THE CIT(A) AND THE HIGH COURT HAVE CORR ECTLY REACHED THIS CONCLUSION.SREE KRISHNA ELECTRICALS V S. STATE OF TAMIL NADU & ANR. (2009) 23 VST 249 (SC) APPLIED ; RELIANCE PETROPRODUCTS (P) LTD. (JUDGMENT DT. 23RD OCT., 2007 OF THE GUJARAT HIGH COURT IN TAX APPEAL NO. 11 49 OF 2007) AFFIRMED. (PARAS 9, 10 & 12) 11 ITA.NO.22/HYD/2013 M/S. SUSHEE INFRA PVT. LTD. HYDERABAD . CONCLUSION : MERELY BECAUSE THE ASSESSEE CLAIMED DEDUCTION OF IN TEREST EXPENDITURE WHICH HAS NOT BEEN ACCEPTED BY THE REVE NUE, PENALTY UNDER S. 271(1)(C) IS NOT ATTRACTED; MERE M AKING OF THE CLAIM, WHICH IS NOT SUSTAINABLE IN LAW, BY ITSE LF, WILL NOT AMOUNT TO FURNISHING INACCURATE PARTICULARS REGARDI NG THE INCOME OF THE ASSESSEE. 16. THE FACTS OF THE CASE ARE SIMILAR TO THE ABOVE CASE. APPLYING THE RATIO OF THE ABOVE DECISION, WE ARE OF THE OPINION THAT MAKING OF AN INCORRECT CLAIM DOES NOT TANTAMOU NT TO FURNISHING INACCURATE PARTICULARS. 17. LEARNED CIT(A) ALSO EXAMINED THE CONTENTION TH AT SURVEY WAS CONDUCTED AND ASSESSEE WITHDREW THE CLAI M. WE AGREE WITH THE FINDINGS OF THE CIT(A) THAT THE CLAIM WAS LIABLE TO REJECTION EVEN IF THERE HAD BEEN NO SURVEY OR EV EN IF THE APPELLANT HAD NOT ACTUALLY WITHDRAWN THE CLAIM. HOW EVER, AS HELD BY THE SUPREME COURT, THE MERE REJECTION OF TH E CLAIM, IRRESPECTIVE OF THE ATTENDANT CIRCUMSTANCES, DOES N OT QUALIFY AS CONCEALMENT OR FURNISHING OF INACCURATE PARTICULARS , WARRANTING LEVY OF PENALTY. 18. THERE IS NO MERIT IN REVENUE CONTENTIONS. THE GROUNDS RAISED ARE DISMISSED. 19. IN THE RESULT, APPEAL OF THE REVENUE IS DISMIS SED. ORDER PRONOUNCED IN THE OPEN COURT ON 28.05.2014. SD/- SD/- (SAKTIJIT DEY) (B. RAMAKOTAIAH) JUDICIAL MEMBER ACOUNTANT MEMBER HYDERABAD, DATED 28 TH MAY, 2014 VBP/- 12 ITA.NO.22/HYD/2013 M/S. SUSHEE INFRA PVT. LTD. HYDERABAD . COPY TO : 1. ACIT, CIRCLE 3(2), HYDERABAD. 2. M/S. SUSHEE INFRA P. LTD. (FORMERLY SUSHEE HI TE CH CONSTRUCTIONS PVT. LTD.), PLOT NO.246/A, MLA CO LONY, ROAD NO.12, BANJARA HILLS, HYDERABAD 500 034. C/O. SRI S. RAMA RAO, ADVOCATE, FLAT NO.102, SHRIYAS ELEGANCE, 3-6-643, STREET NO.9, HIMAYATNAGAR, HYDERABAD-29. 3. CIT(A)-IV, HYDERABAD. 4. CIT-III, HYDERABAD. 5. D.R. ITAT A BENCH, HYDERABAD.