Case Law Details
Mere making of claim, which is not sustainable in law, by itself, not amount to furnishing inaccurate particulars
Whether the ITAT was justified in confirming penalty under Section 271(1)(c) of the Income Tax Act, 1961 on the ground that assessee has furnished inaccurate particulars of income for claiming depreciation on building.
Held that there is no finding recorded by assessing officer that any details supplied by the assessee in its return were found to be incorrect or erroneous or false. A mere making of the claim, which is not sustainable in law, by itself, will not amount to furnishing inaccurate particulars regarding the income of the assessee. Such claim made in the return cannot amount to the inaccurate particulars.
Whether penalty should be imposed u/s 271(1)(c) when a debatable and arguable legal issue is decided against the assessee and the assessee had disclosed full and correct facts.
Claim for depreciation is a technical claim based on interpretation of legal provision. Legal opinion, in such cases, is frequently given by Chartered Accountants to help the company to prepare its return of taxable income; mere making of the claim, which is not sustainable in law, by itself, will not amount to furnishing inaccurate particulars regarding the income of the assessee. Such claim made in the return cannot amount to the inaccurate particulars; divergent legal views on legal interpretation of a statute can take place, but it is not necessary that there should be uniformity or consensus of opinion on the aspects of law. Assessee cannot be faulted and penalty should not be imposed because the assessee had taken a particular stand point, unless there are grounds or reasons to show that the assessee had not disclosed all the facts before the departmental authorities concerned.
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