M/s Saluja Cotex (P) Ltd., Ludhiana V. ITO, Ludhiana

ITA 27/CHANDI/2014

• Counselvise Citation: [2014] 140 COUNSELVISE.COM (IT) 81099 (ITAT-CHANDIGARH)
• Duration Of Justice: 11 month(s) 17 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 23-12-2014
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: B
• Next Hearing Date: 15-12-2014
• Assessment Year: 2006-2007
• Appeal Filed On: 06-01-2014
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: MANJIT SINGH
• Keywords: Wrong claim; Competent authority
• Section: 143(3); 80IB; 10B; 27

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL CHANDIGARH BENCH B, CHANDIGARH BEFORE SHRI BHAVNESH SAINI, JUDICIAL MEMBER AND SHRI T.R.SOOD, ACCOUNTANT MEMBER ITA NO. 27/CHD/2014 ASSESSMENT YEAR : 2006-07 SALUJA COTEX (P) LTD., VS. THE INCOME TAX OFFICER, VILLAGE LAL KALAN, WARD (3), CHANDIGARH ROAD, LUDHIANA. LUDHIANA. PAN: AAHCS1950P (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI ASHWANI KUMAR RESPONDENT BY : SHRI MANJIT SINGH, DR DATE OF HEARING : 15.12.2014 DATE OF PRONOUNCEMENT : 23.12.2014 O R D E R PER BHAVNESH SAINI, J.M. : THIS APPEAL FILED BY THE ASSESSEE IS DIRECTED AGAI NST THE ORDER OF LEARNED COMMISSIONER OF INCOME TAX (APPEAL S)-II, LUDHIANA DATED 24.10.2013 FOR ASSESSMENT YEAR 2006- 07, CHALLENGING THE LEVY OF PENALTY UNDER SECTION 271 ( 1) (C) OF THE INCOME TAX ACT, 1961 ( IN SHORT THE ACT). 2. BRIEFLY, THE FACTS OF THE CASE ARE THAT THE ASSE SSEE FILED RETURN OF INCOME DECLARING INCOME OF RS.47,058/-. THE ASSESSEE WAS ASSESSED UNDER SECTION 143(3) OF THE A CT AT RS.4,71,131/-. THE DISALLOWANCE OF DEDUCTION CLAI MED UNDER SECTION 10B OF THE ACT AMOUNTING TO RS.4,23,532/- W AS MADE. PENALTY PROCEEDINGS UNDER SECTION 271(1)(C) OF THE ACT WERE 2 ACCORDINGLY INITIATED. DURING PENALTY PROCEEDINGS , THE ASSESSEE SUBMITTED THAT DEDUCTION UNDER SECTION 10B OF THE ACT WAS CLAIMED ON THE STRENGTH OF CERTIFICATE ISSU ED BY THE DEVELOPMENT COMMISSIONER, NOIDA SPECIAL ECONOMIC ZO NE, NOIDA. THE ACCOUNTS OF THE ASSESSEE WERE AUDITED BY THE CHARTERED ACCOUNTANT AND THE ASSESSEE WAS UNDER BON AFIDIE IMPRESSION THAT IT WAS ENTITLED TO CLAIM OF EXEMPTI ON UNDER SECTION 10B OF THE ACT. IT WAS SUBMITTED THAT DUR ING THE COURSE OF ASSESSMENT PROCEEDINGS, WHEN IT BECAME AW ARE THAT IT WAS NOT ENTITLED FOR CLAIM OF EXEMPTION UNDER SE CTION 10B OF THE ACT, THE ASSESSEE VOLUNTARILY SUBMITTED VIDE LE TTER DATED 12.11.2008 TO DISALLOW THE SAME SUBJECT TO NO PENAL TY. THE ASSESSING OFFICER, HOWEVER, WAS NOT SATISFIED WITH THE SUBMISSIONS OF THE ASSESSEE AND HELD THAT THE OFFER TO DISALLOW EXEMPTION CLAIMED UNDER SECTION 10B OF THE ACT WAS NOT VOLUNTARY AND WHEN THE ASSESSEE WAS CORNERED, T HE ASSESSEE HAD NO OPTION BUT TO SURRENDER THE AMOUNT IN QUESTION. THE ASSESSING OFFICER FURTHER POINTED O UT THAT THE ASSESSEE COMPANY HAD NEITHER MANUFACTURED ANY ARTIC LE OR THING, NOR IT HAD EXPORTED THESE ARTICLES OR THINGS IN ORDER TO BE ELIGIBLE FOR EXEMPTION UNDER SECTION 10B OF THE ACT. THE ASSESSING OFFICER ALSO POINTED OUT THAT NO CERTIFIC ATE FROM CHARTERED ACCOUNTANT HAS BEEN FILED TO SHOW THAT TH E CLAIM OF EXEMPTION HAS BEEN MADE AS PER THEIR ADVICE. THE ASSESSING OFFICER, THEREFORE, FOUND THAT THE ASSESSEE HAD KNO WINGLY FURNISHED INACCURATE PARTICULARS OF INCOME BY CLAIM ING WRONG EXEMPTION UNDER SECTION 10B OF THE ACT AND VIDE SEP ARATE ORDER LEVIED THE PENALTY UNDER SECTION 271(1)(C) OF THE ACT. 3 3. THE ASSESSEE CHALLENGED THE PENALTY ORDER BEFORE THE LEARNED CIT (APPEALS) AND WRITTEN SUBMISSION OF THE ASSESSEE IS INCORPORATED IN THE APPELLATE ORDER IN WHICH THE ASSESSEE SIMILARLY MADE THE SUBMISSION OF MAKING EXEMPTION U NDER SECTION 10B OF THE ACT BONAFIDELY AND RELIED UPON C ERTAIN DECISIONS IN SUPPORT OF THE SUBMISSION. THE LEARN ED CIT (APPEALS), HOWEVER, DID NOT ACCEPT THE CONTENTION O F THE ASSESSEE AND CONFIRMED THE LEVY OF PENALTY AND DISM ISSED THE APPEAL OF THE ASSESSEE. HIS FINDINGS IN APPELLATE ORDER IN PARAS 3.3 TO 4 ARE REPRODUCED AS UNDER : 3.3 I HAVE CAREFULLY CONSIDERED THE APPELLANT'S SUBMISSION S. THE UNDISPUTED FACT IN THIS CASE IS THAT THE APPELLANT H AD CLAIMED EXEMPTION U/S 10B OF THE INCOME TAX ACT AMOUNTING TO RS.4,23,532 /-. THE ADMITTED AND UNCONTROVERTED FACT IN THIS CASE ALSO IS THAT A PPELLANT WAS NOT ELIGIBLE FOR DEDUCTION U/S 10B IN VIEW OF THE FACT THAT THE APPELLANT HAD NOT MANUFACTURED OR ANYTHING NOR HAD IT EXPORTED ANY ARTICLE OR THING. THE CLAIM OF THE EXEMPTION U/S 10B BY THE APP ELLANT IN THESE CIRCUMSTANCES WAS NOT IN ACCORDANCE WITH THE PROVIS IONS OF LAW. SUCH A CLAIM WAS THEREFORE WRONG CLAIM. THE PROVISIONS OF SECTION 10B ARE VERY CLEAR REGARDING THE CONDITIONS UNDER WHICH THE CLAIM O F EXEMPTION U/S 10B IS ALLOWABLE. THERE IS NO AMBIGUITY REGARDING T HESE PROVISIONS. AS SUCH IT IS APPARENT THAT THE APPELLANT HAD FILED A WRONG CLAIM FOR EXEMPTION U/S 10B OF THE INCOME TAX ACT. 3.4 PENALTY U/S 271(L)(C) IN THIS CASE HAS BEEN IMPOSED IN RESPECT OF THE ADDITION MADE TO THE TAXABLE INCOME OF THE APPELL ANT OF RS. 423532 ON ACCOUNT OF DISALLOWANCE OF EXEMPTION U/S 10B. IN ORD ER TO BE COVERED BY SECTION 271(L)(C),THERE HAS TO BE CONCEALMENT OF THE PARTICULARS OF THE INCOME OR THE ASSESSEE MUST HAVE FURNISHED INACCURATE PARTICULARS OF HIS INCOME. THIS HAS TO BE EXAMINED KEEPING IN VIEW THE PARTICULARS FACTS OF THE CASE. IT IS UNDISPUTED FACT THAT EXEMPTI ON U/S 10B WAS NOT ALLOWABLE ON THIS INCOME. IT IS APPARENT FROM THE FAC TS OF THE CASE THAT THE APPELLANT HAD TRIED TO CLAIM EXEMPTION U/S 10B WH ICH WAS CLEARLY NOT ALLOWABLE ON THE FACTS. IT IS NOT A CASE WHERE THERE WE RE TWO VIEWS ON THE 4 ISSUE. IT IS ALSO NOT A CASE WHERE THE APPELLANT HAD MA DE THE CLAIM BASED ON ANY PROVISION OF THE LAW AND THE SAME WAS DISALLOW ED ON ACCOUNT OF INTERPRETATION OF THE LAW. THE DISALLOWANCE IN THIS CA SE WAS PURELY BASED ON THE FACTS OF THE CASE. THE APPELLANT HAS ALSO PLAC ED RELIANCE ON THE CASE OF CIT VS. RELIANCE PETROPRODUCTS PVT. LTD. REPOR TED IN 322 ITR 158 (SC). HOWEVER, THE FACTS OF THE APPELLANT'S CASE ARE TOTALLY DIFFERENT AND DISTINGUISHABLE FROM THE FACTS INVOLVED IN CIT VS. R ELIANCE PETROPRODUCTS PVT. LTD. (SUPRA). IN THE APPELLANT'S CASE, THE APPELLA NT CLAIMED EXEMPTION U/S 10B EVEN THOUGH IT WAS NOT ALLOWABLE ON FACTS. THEREFORE, THE CLAIM WAS NOT ONLY INCORRECT BUT WAS ALSO NOT BONA FIDE. EX PLANATION 1 TO SECTION 271(1) IS CLEARLY ATTRACTED IN THIS CASE IN AS MUCH AS, THE APPELLANT HAS FURNISHED INACCURATE PARTICULARS OF INCOME. FURTHER IN THE PRESENT SCHEME OF POLICY OF THE DEPARTMENT, ONLY A SMALL NU MBER OF RETURNS ARE TAKEN UP FOR SCRUTINY AND THE RETURNS ARE ACCEP TED WITHOUT ANY FURTHER VERIFICATION FROM THE BOOKS OF ACCOUNTS. IN THE FACTS AND CIRCUMSTANCES, IT IS EVIDENT THAT THE APPELLANT HAD TA KEN A CHANCE TO FILE THE WRONG PARTICULARS KNOWING THE POLICY OF THE DEP ARTMENT REGARDING SCRUTINY ASSESSMENTS. HAD THE CASE NOT BEEN SELECTED FOR SCRUTINY THE ASSESSEE WOULD HAVE REDUCED HIS TAX LIABILITY TO THE E XTENT. RELIANCE IN THIS REGARD IS PLACED ON THE CASE OF CIT VS. ZOOM COMMUNICATIONS PVT. LTD. REPORTED IN (2010)( 327 ITR 510) (DEL.). IN THIS CASE, THE HON'BLE HIGH COURT HELD AS FOLLOWS:- 'IT IS TRUE THAT MERE SUBMITTING A CLAIM WHICH IS IN CORRECT IN LAW WOULD NOT AMOUNT TO GIVING INACCURATE PARTICULARS O F THE INCOME OF THE ASSESSEE, BUT IT CANNOT BE DISPUTED THAT THE CLAIM MA DE BY THE ASSESSEE NEEDS TO BE BONAFIDE. IF THE CLAIM BESIDES BEING IN CORRECT IN LAW IS MALAFIDE, EXPLANATION 1 TO SECTION 271(1) WOULD COME IN TO PLAY AND WORK TO THE DISADVANTAGE OF THE ASSESSEE. THE COURT CANNOT OVERLOOK THE FACT THAT ONLY A SMAL L PERCENTAGE OF THE INCOME TAX RETURNS ARE PICKED UP FOR SCRUTINY. IF THE ASSESSEE MAKES A CLAIM WHICH IS NOT ONLY INCORRECT IN LAW BUT IS ALSO WHOLLY WITHOUT ANY BASIS AND THE EXPLANATION FURNISHED BY HI M FOR MAKING SUCH A CLAIM IS NOT FOUND TO BE BONAFIDE, IT WOULD BE DIFF ICULT TO SAY THAT HE WOULD STILL NOT BE LIABLE TO PENALTY UNDER SECTION 27 1(L)(C) OF THE ACT. IF WE TAKE THE VIEW THAT A CLAIM WHICH IS WHOLLY UNTENAB LE IN LAW AND HAS ABSOLUTELY NO FOUNDATION ON WHICH IT COULD BE MAD E, THE ASSESSEE 5 WOULD NOT BE LIABLE TO IMPOSITION OF PENALTY, EVEN IF HE WAS NOT ACTING BONAFIDE WHILE MAKING A CLAIM OF THIS NATURE, THAT W OULD GIVE A LICENSE TO UNSCRUPULOUS ASSESSEES TO MAKE WHOLLY UNTENABLE AND UNSUSTAINABLE CLAIMS WITHOUT THERE BEING ANY BASIS FOR MAKING THEM, IN THE HOPE THAT THEIR RETURN WOULD NOT BE PICKED UP F OR SCRUTINY AND THEY WOULD BE ASSESSED ON THE BASIS OF SELF ASSESSMENT UN DER SEC 1431 OF THE ACT AND EVEN IF THEIR CASE IS SELECTED FOR SCRU TINY, THEY CAN GET AWAY MERELY BY PAYING THE TAX, WHICH IN ANY CASE, WAS PAYAB LE BY THEM. THE CONSEQUENCE WOULD BE THAT THE PERSONS WHO MAKE CLAIM S OF THIS NATURE, ACTUATED BY A MALAFIDE INTENTION TO EVADE TAX OTHER WISE PAYABLE BY THEM WOULD GET AWAY WITHOUT PAYING THE TAX LEGALLY PAYABLE BY THEM, IF THEIR CASES ARE NOT PICKED UP FOR SCRUTINY. THIS WOULD TAKE AWAY THE DETERRENT EFFECT, WHICH THESE PENALTY PROVISIONS IN THE ACT HAV E. ' 3.5 RELIANCE IS ALSO PLACED ON THE FOLLOWING DECISIONS: (I) DECISION GIVEN BY THE HON'BLE DELHI HIGH COURT IN THE CASE OF KANCHANJUNGA ADVERTISING PVT. LTD. VS. CIT IN ITA NO.944 OF 2011 PRONOUNCED ON 13.01.2012. THE HON'BLE HIGH COURT HELD AS UNDER: 'A LINE OF DISTINCTION THUS APPEARS TO HAVE BEEN DR AWN IN ZOOM COMMUNICATION (SUPRA) SO AS TO PREVENT MISINTERPRETAT ION OF THE VIEW TAKEN BY THE SUPREME COURT IN RELIANCE PETROPRODUCTS (SUPR A). ' ( II) K.P. MADHUSUDAN VS. CIT (2001) 251ITR 99 (SC) 'THE ASSESSEE IS, THEREFORE, BY VIRTUE OF THE NOTICE UNDER S. 271 PUT TO NOTICE THAT IF HE DOES NOT PROVE, IN THE CIRCUMSTANC ES STATED IN THE EXPLANATION, THAT HIS FAILURE TO RETURN HIS CORRECT INCOME WAS NOT DUE TO FRAUD OR NEGLECT, HE SHALL BE DEEMED TO HAVE CONCEA LED THE PARTICULARS OF HIS INCOME OR FURNISHED INACCURATE PARTICULARS THEREOF AND, CONSEQUENTLY, BE LIABLE TO THE PENALTY PROVIDED BY THAT SECTION. ' (III) CIT VS. MANGHA RAM OM PARKASH 276 ITR 362 (2005) (P&H) 'THE EXPLANATION CREATES A LEGAL PRESUMPTION, HE SHA LL BE DEEMED TO HAVE CANCEALED THE PARTICULARS OF HIS INCOME OR FURNISHED INACCURA TE PARTICULARS OF HIS INCOME, UNLESS HE PROVES THAT FAILURE TO RETURN THE CORRECT INCOME DID NOT ARISE FROM ANY FRAUD OR ANY GROSS OR WILLFUL NEGLECT ON HIS PART. THE EXPLANATION SHIFTS THE B URDEN ON THE 6 ASSESSEE AND IF HE FAILS TO ESTABLISH THAT HE HAD NO T CONCEALED THE INCOME OR FILED INCORRECT PARTICULARS OF INCOME WITHOUT ULT ERIOR MOTIVE, IT IS OPEN TO THE COMPETENT AUTHORITY TO LEVY PENALTY. ' (IV) CIT V. ESCORTS FINANCE LTD. 183 TAXMAN 453 IN THIS CASE IT HAS BEEN HELD BY HON'BLE DELHI HIGH COURT THAT SINCE THE RELIEF IS EX FACIE INADMISSIBLE TO THE ASSESSEE, THE ASSESSEE'S CLAIM FOR DEDUCTION WAS NOT A WRONG CLAIM BUT A FALS E CLAIM AND SAME WOULD ATTRACT PENALTY. IT WAS OBSERVED BY THE HON'BLE COURT AS UNDER:- 'WE FIND THAT IT IS NOT A CASE WHERE TWO OPINIONS ABOUT THE APPLICABILITY OF SECTION 35D WERE POSSIBLE. THEREFORE, IT CANNOT BE A CASE OF A BONA FIDE ERROR ON THE PART OF THE ASSESSEE. AS HAS BEEN POINTED OUT A BOVE, THE RELIEF AVAILABLE UNDER SECTION BSD OF THE ACT TO A FINANCE COMPANY IS EX FACIE INADMISSIBLE AS THAT IS CONFINED ONLY TO THE EXISTING INDUSTRIAL UNDERTAKING FOR THEIR EXTENSION OR FOR SETTING UP A NEW INDUSTRIAL U NIT. IT WAS, THUS, NOT A 'WRONG CLAIM' PREFERRED BY THE ASSE SSEE, BUT IS A CLEAR CASE OF FALSE CLAIM'. IN CIT V. VIDYAGAURI NATVERLAL [1999] 238 ITR 91, GUJARAT HIGH COURT MADE A DISTINCTION BETWEEN WRONG CLAIM AS OPPOSED TO FALSE CLAIM AND HELD THAT IF THE CLAIM IS FOUND TO BE FALSE, THE SAME WOULD ATTRACT PENALTY. WE MAY ALSO TAKE NOT E OF THE FOLLOWING OBSERVATIONS OF THE SUPREME COURT IN THE CA SE OF UNION OF INDIA V. DHARAMENDRA TEXTILE PROCESSORS [2008] 306 ITR 277. IN SUCH A CASE IT IS DIFFICULT TO ACCEPT THE PLEA THAT ERROR WA S BONA FIDE. IN VIEW OF THE ABOVE DISCUSSION, I FIND THAT THE ASSESSING OFF ICER WAS JUSTIFIED IN IMPOSING THE PENALTY UNDER SECTION 271(L)(C) OF THE A CT. THE SAME, THEREFORE, UPHELD.' 3.6 IT IS SETTLED LAW THAT PENALTY UNDER SECTION 271( L)(C) IS A CIVIL LIABILITY AND THE REVENUE IS NOT REQUIRED TO PROVE WI LLFUL CONCEALMENT AS HELD BY THE HON'BLE SUPREME COURT IN CASE THE OF UNION OF INDIA VS. DHARAMENDRA TEXTILES AND PROCESSORS(2008) 306 ITR 277(SC). IN CIT VS ATUL MOHAN BINDAL 317 ITR 1 (SC) IT HAS BEEN HELD THAT PENALTY U/S 271(L)(C) IS NEITHER CRIMINAL NOR QUASI CRIMINAL , ALBE IT A STRICT LIABILITY. THEREFORE, THERE IS STRICT LIABILITY ON THE A SSESSEE FOR CONCEALMENT OR FORGIVING INACCURATE PARTICULARS WHI LE FILING THE RETURN. 7 THE PENALTY UNDER THAT PROVISIONS A CIVIL LIABILITY. IT IS OBVIOUS THAT THE PENAL PROVISIONS WOULD OPERATE WHEN THERE IS CONCEALM ENT OF PARTICULARS OF INCOME OR A FAILURE TO DISCLOSE FULLY AND TRULY PARTICULARS OF INCOME. DUTY IS ENJOINED UPON A PERSON TO MAKE A CORRECT AND COM PLETE DISCLOSURE OF PARTICULARS OF HIS INCOME AND IF HE FAILS IN HIS DUT Y BY NOT DISCLOSING PARTICULARS OF HIS INCOME OR PART THEREOF, HE CONCEA LS THE PARTICULARS OF HIS INCOME. THEREFORE, IF THE DISCLOSURE MADE OF THE P ARTICULARS OF INCOME IS INCORRECT, THEN HE COMMITS BREACH OF HIS DUTY. SUC H DEFAULTS ENTAIL THE PENAL CONSEQUENCES CONTEMPLATED BY S. 271(L)(C). 3.7 THE HON'BLE ITAT, CHANDIGARH BENCH VIDE ORDER DA TED 06.12.2012 IN THE CASE OF M/S MANSROVER FORGINGS PVT. LTD., LUDHIANA VS. ACIT IN ITA NO.873/CHD/2012, IN A SIMILAR CASE OF WRONG CLAIM OF DEDUCTION U/S 80IB HAD UPHELD THE DECISION OF THE AO IN IMPOSING PENALTY U/S 271(1)(C). 3.8 KEEPING IN VIEW THE AFORESAID FACTS AND LEGAL POSIT ION, PENALTY IMPOSED U/S 271(1)(C) IS CONFIRMED. THIS GROUND OF APPEAL IS DISMISSED. 4. IN THE RESULT, THE APPEAL OF THE APPELLANT IS DISM ISSED. 4. THE LEARNED COUNSEL FOR ASSESSEE REITERATED THE SUBMISSIONS MADE BEFORE THE LEARNED CIT (APPEALS) A ND ALSO RELIED UPON THE SAME DECISIONS WHICH WERE RELIED UP ON BEFORE THE LEARNED CIT (APPEALS) AND SUBMITTED THAT THE AS SESSEE UNDER THE BONAFIDE ADVICE OF THE CHARTERED ACCOUNTA NT MADE A CLAIM OF EXEMPTION UNDER SECTION 10B OF THE ACT A S THE ASSESSEE WAS HAVING CERTIFICATE IN HIS FAVOUR ISSUE D BY DEVELOPMENT COMMISSIONER, NOIDA SPECIAL ECONOMIC ZO NE, NOIDA. 5. THE LEARNED D.R FOR THE REVENUE RELIED UPON THE ORDERS OF AUTHORITIES BELOW. 8 6. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS AND PER USED THE FINDINGS OF THE AUTHORITIES BELOW. IT IS UNDI SPUTED FACT THAT THE ASSESSEE MADE A CLAIM OF EXEMPTION UNDER S ECTION 10B OF THE ACT IN THE RETURN OF INCOME. THEREFORE , THE BURDEN WAS UPON THE ASSESSEE TO PROVE THAT CONDITIONS OF S ECTION 10B OF THE ACT ARE FULLY SATISFIED. WHEN THE ASSESSING OFFICER FOUND THAT THE ASSESSEE HAS NOT FULFILLED THE CONDI TIONS OF SECTION 10B OF THE ACT, ISSUED A QUESTIONNAIRE DATE D 17.7.2008, WHICH WAS REPLIED BY THE ASSESSEE AND MA DE A SURRENDER OF WRONG CLAIM MADE IN THE RETURN FOR CLA IM OF EXEMPTION UNDER SECTION 10B OF THE ACT. APART FRO M THIS FACT, IT IS ALSO UNDISPUTED FACT THAT THERE WAS NO MANUFACTURING EXPENDITURE CLAIMED BY THE ASSESSEE. THEREFORE, IT WAS FOUND THAT SINCE THERE WAS NO MAN UFACTURING EXPENSES, IT WOULD MEAN THAT THE ASSESSEE HAS NOT MANUFACTURED OR PRODUCED ANY ARTICLE OR THING SO AS TO BE ELIGIBLE FOR EXEMPTION UNDER SECTION 10B OF THE ACT . THE LEARNED COUNSEL FOR ASSESSEE DURING THE COURSE OF A RGUMENTS ALSO, DID NOT DISPUTE THE FINDING OF FACTS GIVEN BY THE AUTHORITIES BELOW THAT DURING THE ASSESSMENT YEAR I N QUESTION, THE ASSESSEE HAD NEITHER MANUFACTURED ANY ARTICLE OR THING, NOR IT HAD EXPORTED THESE ARTICLES OR THI NGS IN ORDER TO BE ELIGIBLE FOR EXEMPTION UNDER SECTION 10B OF T HE ACT. THESE CONDITIONS ARE NECESSARY FOR CLAIMING EXEMPTI ON UNDER SECTION 10B OF THE ACT. THEREFORE, MERELY BECAUSE T HE DEVELOPMENT COMMISSIONER, NOIDA SPECIAL ECONOMIC ZO NE, NOIDA ISSUED A CERTIFICATE IN FAVOUR OF THE ASSESSE E WOULD NOT ABSOLVE THE ASSESSEE FROM PROVING THE NECESSARY ING REDIENTS OF 9 SECTION 10B OF THE ACT. THUS THERE IS NO QUESTION OF MAKING A BONAFIDE CLAIM OF EXEMPTION UNDER SECTION 10B OF THE ACT IN THE RETURN OF INCOME. FURTHER MERELY BECAUSE THE CHARTERED ACCOUNTANT ADVISED TO MAKE CLAIM OF EXEMPTION UNDER SECTION 10B OF THE ACT, WILL NOT MAKE THE CLAIM OF THE ASSE SSEE OF BONAFIDE CLAIM. THE FACTS NOTED ABOVE CLEARLY PRO VE THAT THE ASSESSEE HAS INTENTIONALLY MADE A WRONG CLAIM OF EX EMPTION UNDER SECTION 10B OF THE ACT IN THE RETURN OF INCOM E AND HAS THUS FURNISHED INACCURATE PARTICULARS OF INCOME IN THE RETURN OF INCOME. WHEN THE ASSESSEE HAS MADE WRONG CLAIM INTENTIONALLY IN THE RETURN OF INCOME AND WAS CORNE RED BY THE ASSESSING OFFICER BY ISSUING SHOW CAUSE NOTICE AGAI NST THE ASSESSEE IN THIS REGARD, THE CLAIM MADE BY THE ASSE SSEE OF SURRENDER OF THE INCOME CANNOT BE SAID TO BE BONAFI DE. THUS THE ASSESSEE HAS NO EXPLANATION WHATSOEVER, FOR MAK ING WRONG CLAIM AND AS SUCH, EXPLANATION-1 TO SECTION 271(1)( C) OF THE ACT IS CLEARLY ATTRACTED IN THE CASE OF THE ASSESSE E. THE HON'BLE ALLAHABAD HIGH COURT IN THE CASE CIT VS. RA KESHJ SURI, 331 ITR 458 (ALL) HAS HELD AS UNDER : HELD,, ALLOWING THE APPEAL, THAT THE ASSESSEE HAD CONCEALED THE MATERIAL FACTS AND GIVEN INCORRECT ST ATEMENT OF FACTS IN THE APPLICATION AND ALSO NOT PROVIDED INFORMATION REQUIRED BY THE ASSESSING OFFICER, AFTE R RECEIPT OF NOTICE. ACCORDINGLY THE ACTION OF THE ASSESSEE WAS NEITHER BONA FIDE NOR VOLUNTARY. THE MANNER I N WHICH THE ASSESSEE HAD TRIED TO PROLONG THE CASE BE FORE THE ASSESSING OFFICER BY NOT PROVIDING INFORMATION IMMEDIATELY AND BY NARRATING INCORRECT FACTS IN THE LETTER DATED DECEMBER 6, 2006 SHOWED THAT THE ASSESSEE HAD CONCEALED THE INCOME AND DISCLOSURE WAS NOT VOLUNTA RY 10 BUT UNDER COMPULSION BEING CORNERED BY THE ASSESSIN G OFFICER. PENALTY HAD TO BE IMPOSED. 7. THE HON'BLE PUNJAB & HARYANA HIGH COURT IN THE C ASE OF PREMPAL GANDHI VS. CIT, 335 ITR 23 (P&H) HAS HELD A S UNDER : HELD, DISMISSING THE APPEAL, THAT THE PLAUSIBILITY OR OTHERWISE OF THE EXPLANATION OF THE ASSESSEE WAS A PURE QUESTION OF FACT. ADMITTEDLY, THE ASSESSEE CONCEAL ED THE TRANSACTIONS IN THE BANK ACCOUNT AND WHEN NOTICE OF REASSESSMENT WAS ISSUED, FINDING NO OTHER WAY OUT T HE ASSESSEE SURRENDERED INCOME, TO AVOID PENAL CONSEQUENCES. IN SUCH A SITUATION, IT COULD NOT B E HELD THAT THE ASSESSEE WANTED TO BUY PEACE OF MIND AND T HERE WAS NO EVIDENCE OF CONCEALMENT, WHICH CALLED FOR PE NALTY. THIS WAS NOT A CASE WHERE PENALTY HAD BEEN IMPOSED ONLY BECAUSE THE ASSESSEE DISCLOSED HIGHER INCOME VOLUNT ARILY BUT A CASE OF CLEAR CONCEALMENT WHERE THE ASSESSEE HAVING FOUND NO OTHER WAY OUT,, WAS FORCED TO SURRE NDER THE UNDISCLOSED INCOME. NO SUBSTANTIAL QUESTION O F LAW AROSE. 8. THE CONCEPT OF VOLUNTARY SURRENDER IS NO MORE AP PLICABLE FOR CANCELLATION OF PENALTY AS IS DECIDED BY THE HO N'BLE SUPREME COURT IN THE CASE OF MAK DATA P.LTD. VS. CI T, 358 ITR 593 (SC). CONSIDERING THE ABOVE DECISION IN T HE LIGHT OF THE FINDINGS OF THE AUTHORITIES BELOW, WE ARE OF TH E VIEW THAT PENALTY WAS RIGHTLY LEVIED UNDER SECTION 271(1)(C) OF THE ACT FOR FURNISHING INACCURATE PARTICULARS OF INCOME BY CLAIMING WRONG EXEMPTION UNDER SECTION 10B OF THE ACT. THE DECISIONS CITED BEFORE THE LEARNED CIT (APPEALS) ARE CLEARLY DISTINGUISHABLE ON FACTS AND WOULD NOT SUPPORT THE CLAIM OF 11 THE ASSESSEE. WE, THEREFORE, DO NOT FIND ANY MERI T IN THE APPEAL OF THE ASSESSEE AND THE SAME IS DISMISSED. 9. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON THIS 23 RD DAY OF DECEMBER, 2014. SD/- SD/- (T.R.SOOD) (BHAVNESH SAINI) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED : 23 RD DECEMBER, 2014 *RATI* COPY TO: THE APPELLANT/THE RESPONDENT/THE CIT(A)/TH E CIT/THE DR. ASSISTANT REGISTRAR, ITAT, CHANDIGARH