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Facts
The assessee, Uttaranchal Cooperative Sugar Factories Federation Ltd., was penalized under Section 271(1)(c) for allegedly concealing or furnishing inaccurate particulars of income. The penalty of Rs. 7,67,126/- was levied due to the denial of its mutuality claim amounting to Rs. 25,34,218/-.
Held
The tribunal held that the denial of a mutuality claim, being a bona fide claim, does not constitute concealment or furnishing inaccurate particulars of income. Citing CIT vs. Reliance Petroproducts (P) Ltd., the tribunal deleted the impugned penalty.
Key Issues
The key legal issue was whether the denial of a mutuality claim, considered a bona fide claim, attracts penalty under Section 271(1)(c) for concealment or furnishing inaccurate particulars of income.
Sections Cited
Section 271(1)(c)
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Income Tax Appellate Tribunal, DEHRADUN BENCH, DEHRADUN
Before: Sh. Satbeer Singh Godara & Sh. Manish Agarwal
ORDER
Per Satbeer Singh Godara, Judicial Member:
This assessee’s appeal for Assessment Year 2015-16, arises against the CIT(A)/NFAC, Delhi’s DIN & order No. ITBA/NFAC/S/250/2025-26/10769767588(1) dated 12.06.2025, in proceedings u/s 271(1)(c) of the Income Tax Act, 1961.
Heard both the parties at length. Case file perused.
We notice during the course of hearing that both the learned lower authorities respective findings have held the assessee to have concealed or furnished inaccurate particulars of income thereby levying the impugned penalty amounting to Rs.7,67,126/- in the Assessing Officer’s order dated 26.04.2019 as upheld in the lower appellate discussion.
Uttaranchal Cooperative Sugar Factories Federation Ltd. 4. Both the learned representatives reiterate their respective stands against and in support of the impugned penalty. Learned departmental representative more particularly submits that the corresponding quantum disallowance herein is that of denial of the assessee’s mutuality claim amounting to Rs.25,34,218/- in assessment order dated 30.10.2018.
That being the case, we are of the considered view that such a denial of mutuality claim simpliciter which could neither be held as concealment or that of furnishing of inaccurate particulars of income being in nature of a bonafide claim thereby not attracting penalty either of these two limbs going by CIT vs. Reliance Petroproducts (P) Ltd. (2010) 322 ITR 158 (SC). We thus delete the impugned penalty in very terms.