Case Note & Summary
The appeal was filed by the Revenue under Section 260-A of the Income Tax Act, 1961 against the order of the Income Tax Appellate Tribunal, Bangalore, dated 15.09.2006 in ITA No.3026/Bang/2004. The Tribunal had confirmed the order of the Commissioner of Income Tax (Appeals)-IV, Bangalore, dated 23.07.2004, which deleted the penalty imposed under Section 271(1)(c) of the Act for the assessment year 2002-03. The background of the dispute pertains to penalty proceedings initiated against the assessee, M/s Makino Asia Pvt Ltd (now amalgamated with Makino Machine Tools (India) Pvt Ltd), for alleged concealment of income or furnishing of inaccurate particulars. The Assessing Officer had imposed penalty, which was deleted by the Appellate Authority and confirmed by the Tribunal. The Revenue challenged this deletion before the High Court. The legal issue was whether the Tribunal's order gave rise to any substantial question of law. The Revenue argued that the penalty was justified, while the assessee contended that the findings were concurrent and based on evidence. The court, after hearing both sides, held that the Tribunal's findings were concurrent and based on evidence, and no substantial question of law arose. Consequently, the appeal was dismissed.
Headnote
A) Income Tax - Penalty under Section 271(1)(c) - Concealment of Income - The issue was whether the assessee had concealed income or furnished inaccurate particulars warranting penalty under Section 271(1)(c) of the Income Tax Act, 1961. The court held that the Tribunal's concurrent findings that there was no concealment or furnishing of inaccurate particulars were based on evidence and did not give rise to any substantial question of law. (Paras 2-3)
B) Income Tax - Substantial Question of Law - Section 260-A - The court considered whether the appeal under Section 260-A of the Income Tax Act, 1961 raised any substantial question of law. It held that since the findings of fact by the Tribunal were concurrent and not perverse, no substantial question of law arose. (Paras 2-3)
Issue of Consideration
Whether the Income Tax Appellate Tribunal was correct in confirming the deletion of penalty under Section 271(1)(c) of the Income Tax Act, 1961 for the assessment year 2002-03, and whether any substantial question of law arises from the order.
Final Decision
Appeal dismissed. No substantial question of law arises. The order of the Income Tax Appellate Tribunal confirming deletion of penalty under Section 271(1)(c) is upheld.
Law Points
- Penalty under Section 271(1)(c) of the Income Tax Act
- 1961 requires conscious concealment or furnishing of inaccurate particulars
- mere disallowance of claim does not automatically attract penalty
- no substantial question of law arises when findings are concurrent and based on evidence.
Case Details
2013 LawText (KAR) (09) 18
Justice Dilip B Bhosale, Justice B Manohar
Sri K P Kumar, Senior Counsel for M/s King and Patridge, Advocates for appellants; Sri K.V. Aravind, Advocate for respondent
The Commissioner of Income Tax, Bangalore and The Assistant Commissioner of Income Tax, International Taxation, Circle-19(1), Bangalore
M/s Makino Asia Pvt Ltd (now amalgamated with Makino Machine Tools (India) Pvt Ltd)
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Nature of Litigation
Appeal under Section 260-A of the Income Tax Act, 1961 against order of Income Tax Appellate Tribunal confirming deletion of penalty under Section 271(1)(c).
Remedy Sought
Revenue sought to set aside the Tribunal's order and confirm the penalty order of the Assessing Officer.
Filing Reason
Revenue aggrieved by deletion of penalty imposed under Section 271(1)(c) for alleged concealment of income or furnishing of inaccurate particulars.
Previous Decisions
Assessing Officer imposed penalty; Commissioner of Income Tax (Appeals) deleted penalty; Income Tax Appellate Tribunal confirmed deletion.
Issues
Whether the Tribunal was correct in confirming the deletion of penalty under Section 271(1)(c) of the Income Tax Act, 1961?
Whether any substantial question of law arises from the order of the Tribunal?
Submissions/Arguments
Appellants (Revenue) argued that the penalty under Section 271(1)(c) was justified as the assessee had concealed income or furnished inaccurate particulars.
Respondent (Assessee) contended that the findings of the Tribunal were concurrent and based on evidence, and no substantial question of law arose.
Ratio Decidendi
Penalty under Section 271(1)(c) of the Income Tax Act, 1961 requires conscious concealment or furnishing of inaccurate particulars; mere disallowance of claim does not automatically attract penalty. When findings of fact by the Tribunal are concurrent and based on evidence, no substantial question of law arises under Section 260-A.
Judgment Excerpts
This appeal, under Section 260-A of the Income Tax Act, 1961, is directed against the order dated 15.09.2006 rendered by the Income Tax Appellate Tribunal, Bangalore, in ITA No.3026/Bang/2004.
When hearing of the appeal commenced, we asked Sri K.P. Kumar, learned senior counsel for the appellants, to satisfy us as to whether any substantial question of law arises from the order of the Tribunal.
Having heard learned counsel for the parties, we are satisfied that the Tribunal has recorded concurrent findings of fact and no substantial question of law arises from the order impugned in this appeal.
Procedural History
Assessing Officer imposed penalty under Section 271(1)(c) for assessment year 2002-03. Assessee appealed to Commissioner of Income Tax (Appeals)-IV, Bangalore, who deleted penalty by order dated 23.07.2004. Revenue appealed to Income Tax Appellate Tribunal, Bangalore, which confirmed deletion by order dated 15.09.2006 in ITA No.3026/Bang/2004. Revenue then filed appeal under Section 260-A before High Court of Karnataka, which dismissed the appeal on 25.09.2013.
Acts & Sections
- Income Tax Act, 1961: 260-A, 271(1)(c)
