• Home
  • Current News
  • Columns
  • Judiciary
  • Know your law
  • Stories
  • International News
  • Taxation News
  • Voice of Women
  • Home
  • Current News
  • Columns
  • Judiciary
  • Know your law
  • Stories
  • International News
  • Taxation News
  • Voice of Women
Live Adalat
Facebook Twitter Instagram
  • Home
  • Current News
  • Columns
  • Judiciary
  • Know your law
  • Stories
  • International News
  • Taxation News
  • Voice of Women
Live Adalat
Home»Current News»Penalty cannot be for the wrong claim of TDS: Mumbai Tribunal

Penalty cannot be for the wrong claim of TDS: Mumbai Tribunal

0
By Akshay Sharma on June 3, 2022 Current News, Taxation News
Share
Facebook Twitter LinkedIn Pinterest Telegram WhatsApp

The assessee is an individual engaged in the business of plastic products. He filed a return of income on 15th October 2015 at a total income of Rs.1,22,83,260/-. The assessment under section 143(3) of the Act was passed on 21st December 2018. The learned Assessing Officer noted that the assessee has not shown interest of Rs.2,97,122/- in the income. The assessee submitted that these incomes are credited to the assessee’s account, however as the income belongs to Jolly Containers, where the assessee is a partner. Therefore, the same is chargeable to tax there. The learned Assessing Officer rejected the contention of the assessee stating that the income was credited in the name of the assessee and corresponding TDS also claimed, therefore, he made an addition of Rs.2,97,122/-. On the same, penalty proceedings under section 271(1)(C) of the Act were initiated separately for ‘concealment of income and furnishing inaccurate particulars of income’. AO imposed penalty of Rs.1,10,000/- on the above addition of Rs.2,97,122/-.

The explanation before learned Assessing Officer by the assessee was that assessee started his business initially as proprietor of Jolly Containers, at that time there was a certain investment in fixed deposits and also security deposits with Electricity Board. Interest income is earned on that. At the time of making those deposits, the Permanent Accountant Number of the assessee was given. Subsequently, from 1st April, 2015, the sole proprietorship business of the assessee was converted into a partnership firm and consequently, the fixed deposit and other deposits were appearing in the books of partnership. The interest income received on these deposits was already offered as income in the hands of the partnership for Assessment Year 2016-17. However, as the Permanent Accountant Number of the assessee was available with the bank and Electricity Board, they deducted tax at source by using the Permanent Accountant Number of the assessee instead of the firm. Thus, TDS on this interest appeared in form no. 26AS of the assessee. Being the small amount, inadvertently, the credit of TDS was taken by the individual assessee whereas the interest income was offered in the hands of the partnership firm. The partnership firm also did not claim credit for this TDS. The assessee produced only the account and return of income of the partnership firm. However, the learned Assessing Officer rejected the contention and levied a penalty of Rs.1,10,000/- stating that the assessee has filed ‘inaccurate particulars of income’.

The assessee preferred the appeal before the learned CIT(A), who confirmed the penalty on the merits.

We have carefully considered the rival contentions and perused the order of the lower authorities. In the present case, the levy of penalty under Section 271(1)(c) of the Act is agitated by the assessee stating that notice issued dated 11th June, 2019, under section 274 read with section 271(1)(c) of the Act none of the twin charges were struck off by the learned Assessing Officer. Further, in the assessment order also, the learned Assessing Officer was not sure whether the assessee has furnished inaccurate particulars or has concealed the income. In such circumstances, the penalty levied by the learned Assessing Officer suffers from severe defects. The issue is squarely covered in favour of the assessee by the decision of Hon’ble Supreme Court in case of SSA’S Emerald Meadows (supra). The learned CIT(A) is not correct in upholding the penalty on this ground. The Tribunal held that the explanation is given by the assessee clearly shows that there was neither concealment of income nor furnishing of inaccurate particulars of income and deleted the penalty under section 271(1)(c) of the Act. The appeal filed by the assessee was allowed.

Gautam Hiralal Gandhi vs The DCIT

ITA No. 1485/Mum/2021

Decision in favour of: Assessee

IN THE INCOME TAX APPELLATE TRIBUNAL “G” BENCH, MUMBAI
Income Tax Appellate Tribunal ITAT Mumbai Live Adalat Return of Income Tax Patrika TDS wrong claim
Share. Facebook Twitter Pinterest LinkedIn Telegram WhatsApp
Previous ArticleAmber Heard found guilty for defaming ex-husband Johnny Depp
Next Article Who will save Kashmiri Hindus?

Related Posts

Advocate Jaya Sukin writes to AG KK Venugopal for consent to initiate criminal contempt proceedings against Retired Justice & Advocates for the statements on SC‘s oral observation on Nupur Sharma

July 5, 2022

15 retired judges, 77 senior bureaucrats, and 25 retired armed forces officials submitted an open letter to CJI NV Ramana against observation made by Justices Surya Kant & JB Pardiwala in Nupur Sharma case

July 5, 2022

Judges Must Refrain From Making Derogatory Remarks About Parties Unless It Is Absolutely Necessary For Making a Decision: High Court of J&K&L

July 5, 2022

Comments are closed.

The Live Adalat welcomes articles, blog posts and other forms of content. If you are interested in writing for us, joining us please write to us at adalatlive@gmail.com
Top judgements of March
https://liveadalat.com/wp-content/uploads/2022/03/WhatsApp-Video-2022-03-28-at-16.39.34.mp4
VIEW MORE VIDEOS
INTERESTING LEGAL FACTS
VIEW MORE VIDEOS

Participate in Live Adalat Legal Quiz

Facebook Twitter Instagram

Contact Us

Email : info@liveadalat.com

Subscribe Newsletter

© 2022 Liveadalat.com
  • Home
  • About Us
  • Terms

Type above and press Enter to search. Press Esc to cancel.

Sign In or Register

Welcome Back!

Login to your account below.

Lost password?