Law:

Section:

Section 271(1)(c) of the Income-tax Act, 1961 - Penalty - For concealment of income - Assessment years 1996-97 and 1998-99 - Assessee had written off investments in its books of account and claimed deduction on account of loss occurred to it - Assessee's claim was disallowed and Assessing Officer also levied penalty under section 271(1)(c) upon assessee - Whether when assessee had furnished all particulars in its return of income, merely because a claim put forth by assessee as regards loss was not accepted, that would not per se amount to furnishing of any kind of inaccurate particulars and, therefore, penalty levied upon assessee could not be sustained - Held, yes FACTS The assessee had written off investments in its books of account and claimed deduction on account of loss occurred to it in computation of total income. The Assessing Officer disallowed the assessee's claim. Disallowance was affirmed upto the level of the Tribunal. The Assessing Officer initiated penalty proceedings under section 271(1)(c) in course of which the assessee contended that as the entire facts were disclosed in the return, it could not be treated as concealment of income. The stand put forth by the assessee was rejected and the Assessing Officer imposed the penalty under section 271(1)(c). On appeal, the Commissioner(Appeals) affirmed the order of the Assessing Officer. On second appeal, the Tribunal held that the assessee had declared the entire material in the return of income and merely because a claim of a deduction on account of loss incurred in the capital field as revenue loss was not allowed, it would not make it liable for penalty for concealment of income or furnishing of inaccurate particulars of such income. It, therefore, deleted the penalty. On the revenue's appeal: HELD The assessee had filed the return and furnished all particulars. The Tribunal analyzing the factual matrix had expressed the view that there had been no furnishing of inaccurate particulars of such income and the assessee had declared the entire material. It was a case where a claim put forth by the assessee as regards the loss was not accepted, but that would not per se tantamount to furnishing of…

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