ANITA GOYAL,SIKAR vs. ACIT, CENTRAL CIRCLE-3, JAIPUR, JAIPUR

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ITA 480/JPR/2026Status: DisposedITAT Jaipur31 August 2026AY 2014-158 pages
AI SummaryAllowed

What did the Tribunal hold?

The Tribunal held that the omission was a bonafide and inadvertent human error, as the particulars were already on record and accepted in a prior assessment. Therefore, it did not constitute concealment or furnishing of inaccurate particulars attracting penalty.

What were the facts?

The assessee filed a return under section 153A after a search, inadvertently omitting an income addition of Rs. 1,23,780 that had been accepted and taxed in a prior assessment. The Assessing Officer initiated penalty proceedings for furnishing inaccurate particulars, which was confirmed by the CIT(A).

What were the issues?

Whether an inadvertent omission of previously assessed and taxed income in a return filed under section 153A attracts penalty under section 271(1)(c) of the Income Tax Act.

Which sections of the Income-tax Act were involved?

Section 271(1)(c),Section 153A,Section 143(3)

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, ‘SMC’ BENCH, JAIPUR

Before: Shri T.R. Senthil Kumar & Shri Prakash

IN THE INCOME TAX APPELLATE TRIBUNAL ‘SMC’ BENCH, JAIPUR (PHYSICAL HEARING) Before: Shri T.R. Senthil Kumar, Judicial Member And Shri Prakash, Accountant Member

ITA No: 480/JPR/2026 Assessment Year: 2014-15

Anita Goyal ACIT, Industrial Area, Neem Ka Central Circle-03, Thana, Sikar Vs Jaipur PAN: ACFPG0314G (Respondent) (Appellant)

Assessee Represented: Sh. P. C. Parwal, CA Revenue Represented: Mrs. Arti Rawat, JCIT Date of hearing : 25-08-2026 Date of pronouncement : 31-08-2026 आदेश/ORDER

PER : PRAKASH, ACCOUNTANT MEMBER:-

1.

This appeal by the Assessee is directed against the order of the learned Commissioner of Income Tax (Appeals) [hereinafter referred to as “the learned CIT(A)”] dated 27.01.2026 arising out of the penalty order dated 16.03.2022 passed by the Assessing Officer (hereinafter referred to as “the AO”) under section 271(1)(c) of the Income Tax Act, 1961 (hereinafter referred to as “the Act”) for the assessment year 2014-15.

2.

The grounds of appeal raised by the Assessee before us in the memorandum of appeal in Form No. 36 read as under:

ITA No. 480/JPR/2026 Anita Goyal 1. Under the facts & circumstances of the case, the order passed u/s 271(1)(c) is illegal & bad in law in as much as the penalty proceedings was initiated for furnishing of inaccurate particulars of income but levied for concealment of income. 2. The Ld. CIT(A) has erred on facts and in law in confirming the levy of penalty of Rs.38,250/- u/s 271(1)(c) of IT Act, 1961 on the addition of Rs.1,23,780/- made u/s 143(3) of the Act which was inadvertently left to be considered in the return filed u/s 153A of the Act. 3. The appellant craves to alter, amend and modify any ground of appeal. 4. Necessary cost to be awarded to the assessee. 3. Briefly stated, the facts of the case are that the assessee filed her original return of income for the year under consideration on 05.11.2014 declaring a total income of Rs 12,45,110. The assessment was completed under section 143(3) of the Act on 30.11.2016 at a total income of Rs 13,68,890, after making an addition of Rs 1,23,780. The assessee accepted the said assessment and did not carry it in appeal. The learned CIT(A) has recorded in the impugned order that the addition so made “was accepted by the assessee and tax demand was duly paid”.

4.

Thereafter, a search and seizure action under section 132(1) of the Act was carried out on 13.06.2019 in the case of the Goyal Group, Neem Ka Thana, Sikar, to which the assessee belongs. A notice under section 153A of the Act was issued on 23.03.2021 and, in response thereto, the assessee filed her return of income on 01.04.2021 declaring a total income of Rs 12,45,110, that is to say, the income originally returned by her. The assessment was completed under section 143(3) read with section 153A of the Act on 24.09.2021 at a total income of Rs 13,68,890. No addition was made on the basis of any material found in the course of the search. In paragraph 6 of that assessment order the AO has observed as under:

6.

After examination of the details available on record and verification of the facts with reference to details filed by the assessee’s AR, income assessed u/s 143(3) is acceptable.

ITA No. 480/JPR/2026 Anita Goyal 5. The penalty proceedings were initiated in paragraph 5 of the said assessment order, wherein the AO recorded as under:

5.

On perusal of the details available on record, it seen that the income assessed u/s 143(3) of the Income tax Act, 1961 at Rs.13,68,890/- which has been accepted by the assessee as no appeal filed by her. However, the assessee has shown income at Rs.12,45,110/- in the return filed u/s 153A. Besides the above facts, the assessee did not disclose the above income of Rs.1,23,780/- (Assessed income of Rs.1368890/- minus returned income of Rs.1245110/-) in the returned filed u/s 153A therefore, the penalty proceedings u/s 271(1)(c) of the Income tax Act, 1961 are initiated for furnishing inaccurate particulars of income. 6. A show cause notice was issued on 20.01.2022 and the assessee filed her reply on 04.02.2022. The AO found the reply unsatisfactory. Relying upon the decision of the Hon’ble Supreme Court in Union of India v. Dharamendra Textile Processors [2008] 306 ITR 277 (SC) and upon Explanation 1 to section 271(1)(c) of the Act, the AO levied a penalty of Rs 38,250 by order dated 16.03.2022, being 100 per cent of the tax sought to be evaded. While concluding, the AO recorded in paragraph 7 of the penalty order as under:

7.

In view of the above discussion, it is hereby held that the assessee has altogether failed to establish that penalty u/s 271(1)(c) is not leviable in this case. Therefore, I am satisfied that the assessee had concealed his income to the tune of 1,23,780/- for the year under consideration and it is a fit case for levy of penalty u/s 271(1)(c) of the Income Tax Act, 1961. 7. The assessee carried the matter in appeal. The learned CIT(A), by the impugned order dated 27.01.2026, dismissed the appeal. The operative findings in paragraph 4.2 of the impugned order read as under:

It is undisputed that the assessment u/s 153A is a fresh assessment and the return filed in response thereto substitutes the original return. The appellant was required to disclose the correct and complete income as assessed earlier. However, the appellant chose to file the return u/s 153A at the originally returned income, thereby omitting income already assessed and accepted in earlier proceedings. The explanation of oversight is nothing but an generalized argument for the sake of argument and does not inspire confidence, particularly when the appellant was fully aware of the earlier assessment and tax paid thereon. The fact that the addition was already made in earlier assessment does not absolve the appellant from the obligation to correctly disclose income in the return filed u/s 153A. Failure to do so amounts to furnishing of inaccurate particulars of income. The reliance placed on judicial precedents dealing with bona fide mistakes is distinguishable on facts, as

ITA No. 480/JPR/2026 Anita Goyal in the present case the omission relates to income already assessed and accepted, and not to a debatable or complex issue. 8. Aggrieved, the assessee is in appeal before us.

9.

The learned Authorised Representative (hereinafter referred to as “the learned AR”) submitted before us that the declaration of income at the lower amount in the return filed under section 153A of the Act was a bonafide mistake. He submitted that the sum of Rs 1,23,780 was not any fresh income; it was the very amount which had already been added in the assessment made under section 143(3) of the Act on 30.11.2016, which addition the assessee had accepted and on which she had already paid the tax. He submitted that while filing the return under section 153A of the Act the assessee inadvertently omitted to carry the said addition into her computation of income, and that on realising the mistake she moved a rectification application on 08.10.2021, which was well before the show cause notice dated 20.01.2022. He further submitted that the assessee did not claim in the return filed under section 153A of the Act any refund of the tax already paid on that amount, which she would have claimed had the intention been to escape tax. He also submitted that the penalty proceedings were initiated for furnishing inaccurate particulars of income but the penalty has been levied for concealment of income. He placed reliance upon Price Waterhouse Coopers (P.) Ltd. v. CIT [2012] 348 ITR 306 (SC).

10.

The learned Departmental Representative (hereinafter referred to as “the learned DR”) supported the orders of the authorities below.

11.

We have heard the rival contentions and perused the material available on record.

ITA No. 480/JPR/2026 Anita Goyal 12. Before turning to the two limbs of the controversy, it is useful to set out the facts which are not in dispute. First, the sum of Rs 1,23,780 was not an income which came to light for the first time in the proceedings under section 153A of the Act. It was added by the AO in the assessment completed under section 143(3) of the Act on 30.11.2016, the assessee accepted that addition, did not carry it in appeal, and the resultant demand was paid. Second, nothing bearing upon this sum was found in the course of the search conducted on 13.06.2019. Third, in the assessment made under section 143(3) read with section 153A of the Act on 24.09.2021 the AO made no fresh addition at all and simply adopted the income which stood already assessed, observing that the income assessed under section 143(3) of the Act was acceptable. The amount on which the penalty has been levied is, therefore, the very amount which stood assessed, accepted and taxed long before the search took place.

13.

The short question before us is whether the omission of the sum of Rs 1,23,780 from the return filed under section 153A of the Act attracts the penalty under section 271(1)(c) of the Act. The penalty can be imposed only where the assessee has concealed the particulars of her income or has furnished inaccurate particulars of such income. A difference between the income returned and the income assessed does not by itself answer either description; what has to be seen is the character of the omission.

14.

On this question the law is settled by the judgment of the Hon’ble Supreme Court in Price Waterhouse Coopers (P.) Ltd. v. CIT [2012] 348 ITR 306 (SC). In that case the assessee failed to add back, in its computation of income, a provision for gratuity which its own tax audit report had shown to be inadmissible. Their Lordships held as under:

All that happened in the present case is that through a bona fide and inadvertent error failed to add the provision for gratuity to its total income. This can only be 5

ITA No. 480/JPR/2026 Anita Goyal described as a human error which we are all prone to make. The calibre and expertise of the assessee has little or nothing to do with the inadvertent error. 15. The judgment lays down that where the correct particulars are already on the record, an omission to carry them into the computation is a human error and not a design to conceal, and that such an inadvertent and bonafide error attracts no penalty under section 271(1)(c) of the Act. The facts before us fall squarely within that principle. The sum of Rs 1,23,780 was not an income unknown to the Department. The AO had himself added it in the assessment made under section 143(3) of the Act on 30.11.2016 and the tax upon it had been paid. Just as the particulars in Price Waterhouse Coopers (P.) Ltd. (supra) stood disclosed in the assessee’s own tax audit report, the particulars here stood recorded in the Department’s own assessment order. The assessee gained nothing by the omission, for the tax on this amount remained with the Revenue and, as stated before us and not controverted, its refund was not claimed in the return filed under section 153A of the Act. An omission which hides nothing from the Department and saves no tax to the assessee can only be described as a human error.

16.

The AO rejected the explanation of oversight as unsatisfactory but did not find it to be false. The learned CIT(A) rejected it because the assessee was “fully aware of the earlier assessment and tax paid thereon”. However, the circumstance tells in favour of the assessee, since awareness that the amount stood already assessed and taxed leaves no motive to conceal it. Their Lordships in Price Waterhouse Coopers (P.) Ltd. (supra) have held that the calibre and expertise of the assessee has little or nothing to do with the inadvertent error. Her familiarity with the earlier assessment shows that the omission was careless, not that it was dishonest.

ITA No. 480/JPR/2026 Anita Goyal 17. Explanation 1 to section 271(1)(c) of the Act does not assist the Revenue, because an explanation was offered, it was not found to be false, and all the facts material to the computation of the total income were already before the AO upon his own record. Nor does Dharamendra Textile Processors (supra), upon which the AO relied. That decision holds the penalty to be a civil liability not requiring wilful concealment; it does not make the penalty automatic upon every difference between the returned and the assessed income.

18.

We accordingly hold that the omission of the sum of Rs 1,23,780 from the return filed under section 153A of the Act was a bonafide and inadvertent human error, and that the assessee thereby neither concealed the particulars of her income nor furnished inaccurate particulars of income within the meaning of section 271(1)(c) of the Act. The penalty of Rs 38,250 is directed to be deleted. Ground No. 2 is allowed.

19.

The penalty having been deleted on merits, Ground No. 1 is rendered academic and is left open. Ground No. 3 is general in nature. As regards Ground No. 4, no case for the award of costs has been made out and it is rejected.

20.

In the result, the appeal filed by the Assessee is partly allowed.

Order pronounced in the open court on 31.08.2026

Sd/- Sd/- (T.R. SENTHIL KUMAR) (PRAKASH) JUDICIAL MEMBER ACCOUNTANT MEMBER Dated 31/08/2026 *Ganesh Kr., Sr. PS आदेश क� ��त�ल�प अ�े�षत / Copy of Order Forwarded to:- 7

ITA No. 480/JPR/2026 Anita Goyal 1. Assessee 2. Revenue 3. Concerned CIT 4. CIT (A) 5. DR, ITAT 6. Guard file. By order/आदेश से, सहायक पंजीकार आयकर अपील�य अ�धकरण, t;iqj

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