Income Tax : This guide explains the penalty and prosecution framework under the Income-tax Act for AY 2026-27. It highlights the consequences ...
Income Tax : The article explains how offences such as wilful tax evasion, failure to file returns, non-payment of TDS/TCS, falsification of re...
Income Tax : This article outlines major offences under the Income-tax Act that may result in prosecution, including tax evasion, non-payment o...
Income Tax : This article explains the statutory powers of the Principal Commissioner or Commissioner to waive or reduce penalties in genuine c...
Income Tax : This article outlines major penalties under the Income-tax Act for defaults involving tax payments, return filing, TDS compliance,...
Income Tax : The Committee recommends that the scope of Section 273B should be suitably enlarged to provide that penalty for concealment of inc...
Income Tax : ITAT Delhi held legal services are not FTS under Section 9(1)(vii) and directed partner-wise DTAA examination. FTS addition was de...
Income Tax : ITAT Mumbai quashed reassessment after finding no Section 143(2) notice and that the AO issued a final order disguised as a draft ...
Income Tax : ITAT held an assessment passed after the taxpayer's death was invalid in law, quashed the order, and treated all remaining issues ...
Income Tax : ITAT Chennai held that penalty under Section 271(1)(c) cannot survive when the AO accepts the income declared in the return filed ...
Income Tax : Bombay High Court held penalty under Section 271(1)(c) cannot survive where bogus purchase addition is sustained only on an estima...
Income Tax : Section 270AA of the Income-tax Act, 1961 (the Act) inter alia provides that w.e.f. 1 st April, 2017, the Assessing Officer, on an...
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 him for making such a claim is not found to be bona fide, it would be difficult to say that he would still not be liable to penalty under section 271(1)(c).
In order to apply the provisions of section 271(1)(c), there has to be concealment of particulars of the income of the assessee; the assessee must have furnished inaccurate particulars of his income.
Ingredient about a bona fide claim is that assessee should be able to show or prove some intermediate steps in whole process of transaction; if it is not able to give evidence in respect of any step in whole process of transaction then it can be said that explanation furnished by assessee is not bona fide and is nothing but a bald claim for purposes of section 271(1)(c).
Penalty proceedings- Mere submitting a claim which is incorrect in law would not amount to giving inaccurate particulars of income of assessee, but if claim besides being incorrect in law is malafide, Explanation 1 to section 271(1)(c) comes into play and work to disadvantage of assessee.
Penalty under section 271(1)(c) – Leviability-Expenditure claimed by assessee disallowed by Tribunal-Concealment penalty cannot be imposed merely on the ground that Tribunal disallowed the expenditure claimed by the assessee.
We find that the A.O., CIT (A) as well as the Tribunal has only interpreted the provisions of sec. 80-IA(9) and Sec. 80HHC in a different way. As held by their Lordship, in the case of Reliance Petroproducts Ltd (supra) that merely because the assessee has made some legal claim which has not been accepted by the A.O. that will not amount to furnishing of inaccurate particulars of income of the assessee. In our opinion, there is no justification to support the A.O. for levy of the penalty on the claim of the assessee u/s 80HHC, which was not accepted. We, accordingly, delete the entire penalty by cancelling the penalty order passed by the A.O.
Where assessee chose to sit quietly and did not furnish any satisfactory explanation about cash deposited in minors account which is finally transferred to assessee’s account, then it could not be said that assessee has discharged primary onus lying on him under Explanation 1(A) of section 271(1)(c)
Delhi High Court rules on penalty under Sec 271(1)(c) in CIT Vs Nalwa Sons. Case involves tax assessment, book profits, and disallowed deductions. Read more.
The Tribunal ruling has reiterated the principle of ‘bona fide difference of opinion’ arising in the context of application of most appropriate transfer pricing method. The Tribunal has ruled that any addition to income arising as a result of bona fide difference of opinion cannot be used as a basis for levy of penalty.
The law laid down in the Dilip Sheroff case as to the meaning of word ‘concealment’ and ‘inaccurate’ continues to be a good law because what was overruled in the Dharmender Textile case was only that part in Dilip Sheroff case where it was held that mensrea was a essential requirement of penalty u/s 271(1)(c). The Hon’ble Apex Court also observed that if the contention of the revenue is accepted then in case of every return where the claim is not accepted by the AO for any reason, the assessee will invite the penalty u/s 271(1)(c). This is clearly not the intendment of legislature
