No Section 271(1)(c) Penalty as Assessee Fully Disclosed Relevant Details

PCIT Vs Chetan Kumar Tekriwal (HUF) (Calcutta High Court)

In the case of PCIT vs. Chetan Kumar Tekriwal (HUF), the Calcutta High Court reviewed an appeal filed by the revenue challenging a Tribunal order from November 30, 2023, regarding the assessment year 2015-16. The issue was whether the Assessing Officer was correct in imposing a penalty under Section 271(1)(c) of the Income Tax Act. The court found that the Assessing Officer did not establish that the assessee’s claims were false during either the assessment or penalty proceedings. The Tribunal had earlier ruled, citing the Supreme Court decision in CIT vs. Reliance Petroproducts Private Limited, that since the assessee had fully disclosed all relevant particulars in their return, the penalty under Section 271(1)(c) was not applicable. Consequently, the Calcutta High Court upheld the Tribunal’s decision, dismissed the revenue’s appeal, and confirmed that the penalty provisions were not triggered in this case.

FULL TEXT OF THE JUDGMENT/ORDER OF CALCUTTA HIGH COURT

This appeal by the revenue, filed under section 260(A) of the Income Tax Act, 1971 (hereinafter referred to as “the Act”), is directed against the order dated 30.11.2023, passed by the Income Tax Appellate Tribunal, ^„A’ Bench, Kolkata, in ITA No./705/Kol/2022, for the assessment year 2015-16.

The question involved in this appeal is whether the Assessing Officer was justified in imposing penalty under section 171(1)(c) of the Act?

On going through the facts, it is found that the Assessing Officer nowhere demonstrated that the claim of the assessee was either found to be false either during the assessment proceeding or during the penalty proceeding.

In this regard, the learned Tribunal took note of the decision of the Hon‟ble Supreme Court in the case of CIT –vs- Reliance Petroproducts Private Limited, reported in (2010) 11 SCC 762.

The decision arrived at by the learned Tribunal is just and proper. Since the assessee fully disclosed the particulars in the return of income, section 271(1)(c) of the Act would not stand attracted.

For the aforesaid reasons, the appeal is dismissed and the substantial question of law is answered against the revenue.

The connected application accordingly stands closed.