Penalty under s 271(1)(c)

Furnishing of inaccurate particulars — Recording of satisfaction that there was concealment of particulars of income or furnishing of inaccurate particulars on the part of the assessee towards the addition made by the AO is sine qua non for imposition of a penalty under s 271(1)(c), as held by PuneTrib in ITO v Audyogik Tantra Shikshan Santha — In favour of: The assessee; ITA No 106/PN/2010: (AY 2004–2005).

If the AO fails to initiate penalty proceedings during the course of the assessment proceedings, the imposition of a penalty under s 271(1)(c) is unjustified.

Since the appellate authority has passed a reasoned order deleting the penalty, the same is not liable to be interfered with in an appeal filed before the Tribunal.

The AO should confine himself in making a just and proper assessment only as per the provisions of the law and the harassment of the assessee, which is not permitted under the Statute, should be avoided at all costs.

Appeal (Appellate Tribunal) — The revenue is not supposed to prefer an appeal before the Tribunal against the first appellate order having a tax effect or penalty amount below Rs 3 lakhs.

Decided on: 30 June 2011.