M/S Twinkle Papers (P) Ltd., V. Assistant Commissioner of Income Tax,

ITA 559/CHANDI/2015

• Counselvise Citation: [2015] 140 COUNSELVISE.COM (IT) 95536 (ITAT-CHANDIGARH)
• Duration Of Justice: 3 month(s) 24 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 14-09-2015
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2002-2003
• Appeal Filed On: 21-05-2015
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: S K MITTAL
• Assessee Lawyers: KULDIP SINGH
• Keywords: Business income; Rule of consistency; Bonafide mistake
• Section: 143(3); 147; 68; 148

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL CHANDIGARH BENCHES SMC CHANDIGARH BEFORE SHRI H.L.KARWA, HON'BLE VICE PRESIDENT ITA NO. 559/CHD/2015 ASSESSMENT YEAR: 2002-03 M/S TWINKLE PAPERS (P) LTD., VS. THE ACIT, CIRCL E IV, MALERKOTLA LUDHIANA PAN NO. AAAFT5812D (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI KULDIP SINGH RESPONDENT BY : SH. S.K.MITTAL DATE OF HEARING : 01.09.2015 DATE OF PRONOUNCEMENT : 14.09.2015 ORDER PER H.L.KARWA, VP THIS APPEAL FILED BY THE ASSESSEE IS DIRECTED AGAIN ST THE ORDER OF CIT(A)-2, LUDHIANA DATED 16.3.2015 RELATING TO ASSESSMENT YE AR 2002-03 IN SUSTAINING THE PENALTY OF RS. 51,137/- BEING PENALTY IMPOSED 100% OF TAX SOUGHT TO BE EVADED U/S 271(1)(C) OF THE INCOME-TAX ACT, 1961 (IN SHOR T 'THE ACT') FOR THE ASSESSMENT YEAR 2002-03. 2. BRIEFLY STATED THE FACTS OF THE CASE ARE THAT TH E ASSESSEE COMPANY HAS FILED ITS RETURN OF INCOME ON 24.10.2002 DECLARING NET IN COME OF RS. 60,810/-. THE SAID RETURN WAS PROCESSED U/S 143(1) OF THE ACT AT THE RETURNED INCOME. SUBSEQUENTLY, THE CASE WAS REOPENED AND NOTICE U/S 148 OF THE ACT WAS ISSUED TO THE ASSESSEE ON 27.3.2009. IN PURSUANCE TO THE SAME , ASSESSMENT WAS FRAMED U/S 147 READ WITH SECTION 143(3) OF THE ACT ON 18.12.20 09 DETERMINING TOTAL INCOME 2 AT RS. 2,02,860/-. THE SPECULATION INCOME OF RS. 1,01,43,585/- WAS ASSESSED AS INCOME FROM OTHER SOURCES U/S 68 OF THE ACT AN D DEDUCTION U/S 80IA CLAIMED AT RS. 1,42,053/- WAS DISALLOWED. DURING THE YEAR UNDER CONSIDERATION, THE ASSESSEE HAD SHOWN THE INCOME OF RS. 1,01,43,585/- AS INCOME FORM SPECULATION BUSINESS AND SET IT OFF AGAINST THE B USINESS LOSS. ACCORDING TO ASSESSING OFFICER, OUT OF NET INCOME AFTER SET OFF, IT CLAIMED DEDUCTION U/S 80IA WHICH WAS ALLOWED. HOWEVER, SINCE THE RESULTANT IN COME WAS INCOME FROM OTHER SOURCES, DEDUCTION CLAIMED BY THE ASSESSEE U/S 80I A WAS DISALLOWED. THE ASSESSEE WENT IN APPEAL BEFORE THE CIT(A)-2, LUDHIA NA AND THE APPEAL OF THE ASSESSEE TO THE ABOVE EXTENT WAS DISMISSED. THE AS SESSING OFFICER OPINED THAT AS THE INCOME OF THE ASSESSEE WAS HELD TO BE INCOME FROM OTHER SOURCES, NO CLAIM OF DEDUCTION US/ 80IA WAS ALLOWED AND PENALTY PROCEEDINGS U/S 271(1)(C) OF THE ACT WERE INITIATED AGAINST THE ASSESSEE. A S HOW CAUSE NOTICE WAS ISSUED TO THE ASSESSEE. HOWEVER, THERE WAS NO RESPONSE FROM T HE ASSESSEE AND, THEREFORE, ASSESSING OFFICER LEVIED PENALTY OF RS. 1,53,411/- STATING AS UNDER:- AS HAS BEEN MENTIONED ABOVE, THE ASSESSEE ATTEMPTE D TO SHOW INCOME EARNED FROM UNDISCLOSED SOURCES AS BUSINESS INCOME. IT WOULD BE WORTHWHILE TO GO A BIT DEEPER INTO THE FACT OF THE CASE. IN THE P&L ACCOUNT, THE ASSESSEE HAS SHOWN AMOUNT OF RS. 5,58, 16,817/~ WITH THE NARRATION 'SALES INCLUDING MISC. RECEIPTS'. NO DETA ILS OF THE SAME HAVE BEEN FURNISHED IN THE RETURN AND AUDIT REPORT FILED ALONGWITH THE RETURN. SIMILAR WAS THE POSITION IN RESPECT OF A.Y. 2003- 04. IT WAS ONLY DURING THE SCRUTINY ASSESSMENT PROCEEDINGS FOR THE A.Y. 20 03-04 THAT IT WAS NOTICED THAT THE MISC. RECEIPTS ARE IN FACT INCOME OF THE ASSESSEE FROM UNDISCLOSED SOURCES WHICH HAS BEEN SHOWN AS BUSINES S INCOME. IN THIS WAY THE ASSESSEE RESORTED TO A TOTALLY UNDESIRABLE METHODOLOGY TO EVADE THE PAYMENT OF DUE TAX. NO WORTHWISE EXPLANATION CO ULD BE FURNISHED AND THE CLAIM COULD NOT BE PROVED. THE FINDING OF T HE A,0. HAVE BEEN UPHELD BY THE LD. CIT(A) ALSO. THE ASSESSEE HAD FIL ED NO REPLY IN RESPONSE TO SHOW CAUSE NOTICE AND HAS NOT STATED AN YTHING AGAINST IMPOSITION OF PENALTY. ALL THESE FACTS MAKE IN CLEA R THAT THE ASSESSEE HAD 3 WILLFULLY FURNISHED INACCURATE PARTICULARS OF INCOM E WITH THE PURPOSE OF EVASION OF TAX AND IT HAS NO DEFENCE AGAINST. ACCOR DINGLY IT IS LIABLE FOR PENALTY U/S 271(1)(C) OF THE INCOME TAX ACT, 1961. THE PENALTY LEVIABLE IS COMPUTED AS BELOW: - INCOME SOUGHT TO BE CONCEALED RS. 1,42,053/- TAX SOUGHT LO BE EVADED ON THE ABOVE RS. 5 1,137/- MINIMUM PENALTY - 100% OF ABOVE RS. 51 ,137/- MAXIMUM PENALTY - 300% OF ABOVE RS.1,53,41 1/- 3. AGGRIEVED BY THE ORDER OF THE ASSESSING OFFICER THE ASSESSEE CARRIED THE MATTER IN APPEAL BEFORE THE CIT(A) AND THE LD. CIT( A) OBSERVED THAT IT IS A CLEAR CASE OF FURNISHING OF INACCURATE PARTICULARS OF INC OME, THEREFORE, THE ASSESSING OFFICER WAS JUSTIFIED IN HOLDING THAT ASSESSEE HAD FURNISHED INACCURATE PARTICULARS OF INCOME. HOWEVER, THE CIT(A) RESTRIC TED THE PENALTY TO 100% OF TAX SOUGHT TO BE EVADED, WHICH COMES TO RS. 51,137/ - AS AGAINST RS. 1,53,411/- IMPOSED BY THE ASSESSING OFFICER. 4. I HAVE HEARD THE LD. REPRESENTATIVES OF BOTH THE PARTIES AT LENGTH AND HAVE ALSO PERUSED THE MATERIALS AVAILABLE ON RECORD. SHR I KULDIP SINGH, LD. COUNSEL FOR THE ASSESSEE SUBMITTED THAT THERE WAS NO ITEM OF CONCEALMENT AND THE ASSESSEE HAD NEITHER CONCEALED ANY INCOME NOR HAD F URNISHED ANY INACCURATE PARTICULARS OF INCOME AS ALLEGED BY THE LOWER AUTHO RITIES. HE FURTHER STATED THAT PENALTY PROCEEDINGS U/S 271(1)(C) OF THE ACT HAVE WRONGLY BEEN INITIATED AS THE INCOME OF RS. 1,01,43,585/- STOOD DECLARED IN THE R ETURN AND SIMPLY CHANGE OF NOMENCLATURE / SOURCE, THE I.T. ACT, 1961 DOES NOT PROVIDE IMPOSITION OF PENALTY IN THE CASE OF INCLUSION OF THE INCOME IN THE DECL ARED INCOME IN THE RETURN. SHRI KULDIP SINGH LD. COUNSEL FOR THE ASSESSEE VEHEMENTL Y ARGUED THAT DISALLOWANCE 4 OF CLAIM OF THE ASSESSEE ON ACCOUNT OF DEDUCTION U /S 801A OF THE ACT, IS BASED ON THE CHARTERED ACCOUNTANTS AUDIT REPORT, A QUALI FIED ACCOUNTS EXPERT. THE CLAIM WAS MADE UNDER THE BONAFIDE MISTAKE AND, THER EFORE, NO PENALTY U/S 271(1)(C) OF THE ACT SHOULD BE LEVIED. HE FURTHER P OINTED OUT THAT A SIMILAR DISALLOWANCE OF CLAIM U/S 80IA OF THE ACT TO THE TU NE OF RS. 2,13,857/- WAS MADE IN THE ASSESSMENT YEAR 2003-04 AND PENALTY U/S 271(1)(C) OF THE ACT WAS ALSO IMPOSED BY THE THEN ASSESSING OFFICER AND THE SAME WAS CANCELLED BY LD. CIT(A)-II LUDHIANA VIDE HIS ORDER DATED 4 TH JANUARY 2012 . SHRI KULDIP SINGH, LD. COUNSEL FOR THE ASSESSEE ALSO RELIED ON THE DEC ISION OF HON'BLE PUNJAB & HARYANA HIGH COURT IN THE CASE OF CIT V ARISUDHANA SPINNING MILLS LIMITED [2010] 326 ITR 429 (P&H) . ON THE OTHER HAND, SHRI S.K. MITTAL, LD. DR HEAVILY RELIED ON THE ORDERS OF THE LOWER AUTHORITI ES. 5. IN THE INSTANT CASE, THE SPECULATIVE INCOME OF R S. 1,01,43,585/- SHOWN BY THE ASSESSEE WAS ASSESSED AS INCOME FROM OTHER SOUR CES U/S 68 OF THE ACT. THE ASSESSEE CLAIMED DEDUCTION U/S 80IA AT RS. 1,42,053 /-. THE SAID CLAIM WAS DISALLOWED BY THE LOWER AUTHORITIES. THE CLAIM MAD E BY THE ASSESSEE WAS BASED ON THE CHARTERED ACCOUNTANTS AUDIT REPORT, A QUALI FIED ACCOUNTS EXPERT. BESIDES ABOVE, THE ENTIRE MATERIAL WAS AVAILABLE BE FORE THE ASSESSING OFFICER. IN MY OPINION FOR THE LEGAL ADVICE RENDERED BY THE CHARTERED ACCOUNTANT UNDER BONAFIDE MISTAKE, NO PENALTY IS LEVIABLE IN VIEW OF THE DECISION OF THE HON'BLE JURISDICTIONAL HIGH COURT IN THE CASE OF CIT V AR ISUDANA SPINNING MILLS LTD [2010] 326 ITR 429 (P&H). IN THE SAID CASE, THE ASS ESSEE WAS ENGAGED IN THE BUSINESS OF MANUFACTURING OF YARN AND TRADING IN WO OL. THE ASSESSEE CLAIMED DEDUCTION U/S 80IA OF THE ACT IN RESPECT OF PROFITS DERIVED FROM TRADING TURNOVER, I.E. TRADING IN RAW WOOL AND KNITTED CLOT H. THE RETURN OF INCOME FILED BY THE ASSESSEE WAS ACCOMPANIED BY THE AUDITED BALA NCE-SHEET, PROFIT AND LOSS ACCOUNT AND AN AUDIT REPORT IN FORM NO. 10CCB RELAT ING TO THE CLAIM OF 5 DEDUCTION UNDER SECTION 80IA OF THE ACT. THE ASSES SING OFFICER DISALLOWED THE DEDUCTION TO THE ASSESSEE STATING THAT DEDUCTION U /S 80IA OF THE ACT WAS ALLOWABLE ONLY IN RESPECT OF INCOME DERIVED FROM MA NUFACTURING OF GOODS AND NOT FROM TRADING IN RAW WOOL AND KNITTED CLOTH. THE ASSESSING OFFICER ALSO INITIATED PENALTY PROCEEDINGS U/S 271(1)(C) OF THE ACT FOR FURNISHING OF INACCURATE PARTICULARS OF INCOME IN ITS RETURN WITH AN INTENTION TO EVADE TAX. THE ORDER OF THE ASSESSING OFFICER WAS SET ASIDE BY THE CIT(A) BUT THE TRIBUNAL WHILE SETTING ASIDE THE ORDER OF THE CIT(A) CONFIRM ED THE ORDER OF THE ASSESSING OFFICER BY RELYING UPON THE DECISION DATED 17.8.20 06 RENDERED BY JURISDICTIONAL HIGH COURT IN LIBERTY INDIA V CIT [2007] 293 ITR 5 20(P&H). AFTER THE DECISION OF THE TRIBUNAL, THE PENALTY PROCEEDINGS W ERE FINALIZED AND PENALTY U/S 271(1)(C) WERE IMPOSED UPON THE ASSESSEE. ON APPEA L, THE CIT(A) DELETED THE PENALTIES. AGAINST THE ORDER OF CIT(A), THE REVENUE PREFERRED APPEALS BEFORE THE TRIBUNAL AND THE TRIBUNAL VIDE ITS ORDER DATED 20.1 1.2008 UPHELD THE ORDER OF THE CIT(A). AGAINST THE ORDER OF THE TRIBUNAL, THE REVENUE FILED THE APPEALS BEFORE THE JURISDICTIONAL HIGH COURT AND THE HON' BLE HIGH COURT OBSERVED THAT THE INCOME-TAX APPELLATE TRIBUNAL WHILE RELYING ON THE DECISION OF HON'BLE SUPREME COURT IN T. ASHOK PAI V CIT [2007] 292 ITR 11 (SC) HELD THAT PENALTY U/S 271(1)(C) WAS NOT LEVIABLE WHERE THE CLAIM OF T HE ASSESSEE WAS BASED ON THE REPORT OF THE EXPERT. SINCE THE RETURN OF INCOME WA S ACCOMPANIED BY THE DULY AUDITED REPORT REQUIRED U/S 80IA, THE PENALTY CANNO T BE IMPOSED PARTICULARLY WHEN THERE IS NOTHING ON RECORD TO SUGGEST THAT THE REPORT OF THE AUDITOR WAS COLLUSIVE. THE HON'BLE JURISDICTIONAL HIGH COURT FU RTHER OBSERVED THAT WHEN THE RETURN OF INCOME WAS FILED, THE ISSUE WITH REGARD T O THE ENTITLEMENT OF DEDUCTION U/S 80-IA ON THE PROFITS DERIVED FROM THE TRADING T URNOVER, I.E. TRADING IN RAW WOOL AND KNITTED CLOTH WAS DEBATABLE, AND THIS ISSU E WAS SETTLED WITH THE JUDGEMENT OF THE HON'BLE HIGH COURT IN THE CASE OF LIBERTY INDIA LTD [2007] 293 ITR 520 (P&H) WHICH HAS BEEN UPHELD BY THE HON' BLE SUPREME COURT IN LIBERTY INDIA LIMITED [2009] 317 ITR 218 (SC). THE HON'BLE JURISDICTIONAL HIGH 6 COURT HAS HELD THAT THE TRIBUNAL HAS RIGHTLY COME T O THE CONCLUSION THAT THE ASSESSEE DID NOT DELIBERATELY OR CONSCIOUSLY CONCEA L THE TRUE PARTICULARS OF INCOME OF FURNISHED INACCURATE PARTICULARS OF INCOM E. THE HON'BLE JURISDICTIONAL HIGH COURT DISMISSED THE APPEALS PRE FERRED BY THE REVENUE. IN THE INSTANT CASE, THE ASSESSEE MANUFACTURERS PAPER CONE S AND CORRUGATED BOXES SINCE ITS INCEPTION. THE ASSESSEE BEING INDUSTRIAL UNDER TAKING IS ENTITLED TO DEDUCTION U/S 80IA OF THE ACT AND ACCORDINGLY CLAIMED THE PE RMISSIBLE DEDUCTION IN THE YEAR UNDER CONSIDERATION WHILE COMPUTING THE INCOME AND NECESSARY FORM NO. 10CCB WAS FILED WITH AUDIT REPORT DONE BY THE C.A. IT IS CLAIMED THAT THE RELEVANT FACTS WERE DULY SCRUTINIZED BY THE COMPET ENT AND QUALIFIED ACCOUNTS EXPERT AND WORKED OUT OF DEDUCTION U/S 80IA AND CL AIMED DEDUCTION ACCORDINGLY ON BONAFIDE MISTAKE THAT DEDUCTION U/S 80IA IS AL LOWABLE AND UNDER THE PROVISION OF THE ACT. HOWEVER, THE ASSESSING OFFICE R DISALLOWED THE DEDUCTION LAWFULLY ON THE PLEA THAT THE DEDUCTION U/S 80IA OF THE ACT WAS NOT ALLOWABLE ON SPECULATIVE PROFIT OF INCOME. FROM THE FACTS OF PRE SENT CASE, IT IS CRYSTAL CLEAR THAT THE CLAIM OF THE ASSESSEE HAD BEEN DULY CERTIF IED BY THE CHARTERED ACCOUNTANT, AND THEREFORE, THE PLEA OF THE ASSESSE E THAT THE CLAIM WAS MADE UNDER A BONAFIDE MISTAKE CANNOT BE REJECTED. IN TH E CASE OF CIT V DEEP TOOLS PVT LTD [2005] 274 ITR 603 (P&H) WHEREIN IT HAS BE EN HELD THAT CLAIM FOR DEDUCTION BASED ON CERTIFICATE FROM THE CHARTERED A CCOUNTANT / AUDITOR WHICH WAS NOT IN ACCORDANCE WITH SECTION 80HHC(4) OF THE ACT, WAS NOT ENOUGH TO HOLD THAT THE MISTAKE WAS NOT BOANAFIDE AND CANCELL ED THE PENALTY LEVIED U/S 271(1)(C) OF THE ACT WAS HELD TO BE JUSTIFIED. IN T HE SAID JUDGMENT OF JURISDICTIONAL HIGH COURT HAS HELD AS UNDER;- 8. THERE IS NOTHING TO SHOW THAT THE MISTAKE BY TH E CA WAS NOT BONA FIDE AND THE MERE FACT THAT THE CERTIFICAT E ISSUED BY THE CA WAS NOT IN ACCORDANCE WITH SECTION 80HHC(4) OF THE ACT, WAS NOT ENOUGH TO HOLD THAT THE MISTAKE WAS NO T BONA FIDE. AT ANY RATE, AS FAR AS THE ASSESSEE IS CONCER NED, NO MALA FIDES CAN BE ATTRIBUTED TO IT, AS THE CLAIM FOR DED UCTION WAS 7 BASED ON THE CERTIFICATE OF THE CA WITH WHOM NO COL LUSION HAS BEEN PROVED. IN VIEW OF THE FINDINGS RECORDED BY TH E TRIBUNAL THAT ERROR OF THE CA WAS INADVERTENT AND DID NOT LA CK BONA FIDES, CANCELLATION OF THE ORDER OF PENALTY WAS CLE ARLY JUSTIFIED. 6. IT IS RELEVANT TO MENTION THERE THAT IN THE ASSESSMENT YE AR 2003-04 ALSO, THE ASSESSEE CLAIMED DEDUCTION U/S 80IA OF THE ACT. THE SAID DEDUCTION WAS DISALLOWED ON THE SPECULATIVE SHARE IN PROFIT. THE ASSESSING OFFICER INITIATED PENALTY PROCEEDINGS U/S 271(1)(C) OF THE ACT AND IM POSED A PENALTY OF RS. 823,269/- ON APPEAL, THE CIT(A) FOLLOWING THE DECI SION OF HON'BLE JURISDICTIONAL HIIGH COURT IN THE CASE OF CIT V A RISUDANA SPINNING MILLS LTD (SUPRA) CANCELLED THE PENALTY OBSERVING AS UNDER:- 5. AFTER CONSIDERING THE TOTALITY OF THE FACTS AN D CIRCUMSTANCES OF THE CASE, I AM ALSO OF THE VIEW TH AT NO PENALTY CAN BE IMPOSED WHERE THE CLAIM OF THE ASSES SEE WAS BASED ON THE REPORT OF THE EXPERT AND THE ASSESSING OFFICER HAS PLACED NOTHING ON RECORD TO SUGGEST THAT THE SA ID REPORT IS COLLUSIVE. KEEPING VIEW THE ABOVE, THE PENALTY I MPOSED ON THE EXCESS DEDUCTION DISALLOWED U/S 80IA IN THE INS TANT CASE IS HEREBY DELETED. FROM THE ABOVE IT IS CLEAR THAT THAT ON SIMILAR FAC TS, THE CIT(A) CANCELLED THE PENALTY LEVIED U/S 271(1)(C) OF THE ACT IN THE AS SESSMENT YEAR 200-03 VIDE HIS ORDER DATED 4.1.2012. IN THIS YEAR, THE CIT(A) HA S TAKEN A CONTRARY VIEW AND CONFIRMED THE PENALTY LEVIED BY THE ASSESSING OFFIC ER. IN MY OPINION THE ACTION OF THE CIT(A) IN CONFIRMING THE PENALTY CANNOT BE H ELD JUSTIFIED. IN MY CONSIDERED OPINION BY MAKING A LEGAL CLAIM AND CLAI MING DEDUCTION U/S 80IA , THE ASSESSEE IS NOT HELD TO BE GUILTY FOR FURNISHI NG INACCURATE PARTICULARS OF INCOME WITH THE PURPOSE OF EVASION OF TAX. AS I HAV E ALREADY OBSERVED HEREINABOVE THAT THE CIT(A) HIMSELF HAS CANCELED TH E LEVY OF PENALTY ON SIMILAR FACTS FOR ASSESSMENT YEAR 2003-04 VIDE HIS ORDER DA TED 4.1.2012. THUS, IT IS CLEAR THAT WHILE PASSING THE IMPUGNED ORDER THE CIT(A) H AS NOT FOLLOWED THE 8 PRINCIPLE OF CONSISTENCY, PARTICULARLY WHEN THE FAC TS OF THE PRESENT YEAR ARE SIMILAR TO THE FACTS OF THE ASSESSEE CASE IN ASSESS MENT YEAR 200-03 AND THE ORDER WAS PASSED PRIOR TO THE PASSING OF IMPUGNED ORDER. ON THIS SCORE ALONE, THE ORDER OF CIT(A) IS NOT TENABLE AND LIABLE TO THE SE T ASIDE. EVEN OTHERWISE ALSO, THERE IS NO FINDING THAT THE CLAIM OF DEDUCTION WAS BOGUS OR FALSE. THE ASSESSING OFFICER HAS SIMPLY STATED THAT THE ASSESSEE RESTORE D TO THE TOTALLY UNDESIRED METHOD TO EVADE THE PAYMENT OF DUE TAX. HE FURTHER STATED THAT NO WORTHWISE EXPLANATION COULD BE FURNISHED AND THE CLAIM COULD NOT BE PROVED. IT APPEARS THAT THE ASSESSING OFFICER HAS DOUBTED THE METHOD O F ACCOUNTING FOLLOWED BY THE ASSESSEE. IN MY CONSIDERED OPINION, THE ISSUE INVOL VED IN THIS CASE IS SQUARELY COVERED IN FAVOUR OF THE ASSESSEE BY THE DECISION O F HON'BLE JURISDICTIONAL HIGH COURT IN THE CASE OF CIT V ARISUDANA SPINNING MILL S LTD (SUPRA) AND CIT V DEEP TOOLS PVT LTD (SUPRA). IN VIEW OF THESE DECISI ONS, NO PENALTY U/S 271(1)(C) OF THE ACT IS LEVIABLE. IN THE INSTANT CASE, THE A SSESSING OFFICER HAS STATED THAT THE CLAIM MADE BY THE ASSESSEE WAS LEGALLY UNACCEPT ABLE. IN MY OPINION, IT DOES NOT AMOUNT TO FURNISHING OF INACCURATE PARTICULARS OF INCOME OR CONCEALMENT OF INCOME. IN VIEW OF THE ABOVE, NO PENALTY U/S 271(1) (C) OF THE ACT CAN BE VALIDLY LEVIED ON THE FACTS OF THE PRESENT CASE. 7. IT WOULD BE ALSO WORTHWHILE TO MENTION HERE THAT HON'BLE SUPREME COURT IN THE CASE OF CIT VS. RELIANCE PETROPRODUCTS PVT. LTD [2010] 322 ITR 158 (SC) HAS HELD AS UNDER:- 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 PENAL TY UNDER SECTION 271(1)(C) . A MERE MAKING OF A CLAIM, WHICH IS NOT SUSTAINABLE IN LAW, BY ITSELF, WILL NOT AMOUNT TO F URNISHING INACCURATE PARTICULARS REGARDING THE INCOME OF THE ASSESSEE. 9 SUCH A CLAIM MADE IN THE RETURN CANNOT AMOUNT TO FU RNISHING INACCURATE PARTICULARS. 8. IN THE INSTANT CASE ALSO, THE ASSESSING OFFICER HAS NOT GIVEN ANY FINDING THAT ANY DETAILS SUPPLIED BY THE ASSESSEE IN ITS R ETURN WERE FOUND TO BE INCORRECT OR ERRONEOUS OR FALSE. THEREFORE, IN VIEW OF THE JU DGMENT OF THE HON'BLE SUPREME COURT IN THE CASE OF CIT VS. RELIANCE PETRO PRODUCTS PVT. LTD (SUPRA), THERE IS NO QUESTION OF LEVY OF PENALTY FOR MAKING A CLAIM WHICH IS NOT SUSTAINABLE IN LAW, BY ITSELF WILL NOT AMOUNT TO FU RNISHING OF INACCURATE PARTICULARS REGARDING THE INCOME OF THE ASSESSEE. I N VIEW OF THE JUDGMENT OF THE HON'BLE SUPREME COURT (SUPRA), SUCH CLAIM MADE IN T HE RETURN CANNOT AMOUNT TO INACCURATE PARTICULARS OF INCOME. KEEPING IN VIEW THE RATIO LAID DOWN BY THE HON'BLE SUPREME COURT IN THE CASE OF CIT VS. RELIAN CE PETROPRODUCTS PVT. LTD (SUPRA) ALSO, NO PENALTY U/S 271(1)(C) OF THE ACT I S LEVIABALE. 9. VIEWED FROM ANY ANGLE, NO PENALTY U/S 271(1)(C) OF THE ACT CAN BE VALIDLY LEVIED IN THIS CASE. 10. IN VIEW OF THE ABOVE DISCUSSION, I CANCEL THE P ENALTY AND ALLOW THE APPEAL OF THE ASSESSEE. 11. IN THE RESULT, APPEAL IS ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 14.09.2015 SD/- (H.L.KARWA) VICE PRESIDENT DATED : 14 TH SEPT., 2015 RKK COPY TO: 1. THE APPELLANT 2. THE RESPONDENT 3. THE CIT 4. THE CIT(A) 5. THE DR 10