Smt. Smita Ashok Thakkar vs. DCIT

Parties Involved

Facts Summary

Brief facts of the case are that the assessee had filed her return of income dated 24.01.2013 declaring total income at Rs.19,21,260/-. Pursuant to the search action carried out in the case of Thakkar Group dated 10.08.2011, where the assessee’s case was selected for scrutiny under CASS and notices u/s. 143(2) and 142(1) of the Act were duly issued and served upon the assessee. The learned Assessing Officer ('ld. A.O.' for short) had passed the assessment order dated 27.03.2014, declaring total income at Rs.55,08,510/- after making an addition of Rs.26,98,498/- and Rs.10,02,226/- (on protective basis) as ‘unexplained jewellery’ u/s. 69A of the Act found during search proceedings. The ld. A.O. also initiated penalty proceeding u/s. 271(1)(c) of the Act and vide order dated 23.03.2022 levied impugned penalty of Rs.5,28,234/- vide notice u/s. 274 r.w.s. u/s. 271(1)(c) of the Act dated 21.03.2014 for furnishing inaccurate particulars of income and concealment of income.…

Legal Issues

• 1. On the facts and circumstances of the case and in law, the learned Commissioner of Income Tax (Appeals) erred in confirming the penalty levied by Assessing Officer u/s 271(1)(c) of Rs. 5,28,234/- which is bad in law.
• 2. a) On the facts and circumstances of the case and in law, the learned Commissioner of Income Tax (Appeals) erred in confirming the action of Assessing Officer of claiming that the penalty levied u/s 271(1)(c) in the assessment order is levied under both limbs i.e concealment of income and also for furnishing of inaccurate particulars which is bad in law without considering the fact that concealment and furnishing of inaccurate particulars cannot exist together. b) On the facts and circumstances of the case and in law, the learned Commissioner of Income Tax (Appeals) erred in confirming the action of Assessing Officer in imposing penalty of Rs.5,28,234/- u/s 271(1)(c) being 100% of the amount of tax sought to be evaded on Rs. 17,09,498/- by reason of concealment of particulars and furnishing of inaccurate particulars of such income as mentioned in the penalty order without considering the fact that the jewellery found in the locker which is considered as unexplained belonged to the daughter of the assessee and hence there was neither any concealment of income nor furnishing of any inaccurate facts. Levy of penalty on the same is bad in law.
• 3. The learned Authorised Representative (ld. AR for short) for the assessee argued on the legal ground stating that the ld. A.O. had issued notice u/s. 274 r.w.s. 271 of the Act, without striking out the irrelevant limb as to whether the penalty was levied for concealment of particulars of income or for furnishing inaccurate particulars of income. The ld. AR relied on various decision in support of his contention.

Judgment Outcome

Decided in favour of Assessee.

Precedents Relied Upon

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