Penalty u/s 271(1)(c) for inadvertently not showing salary from second employer deleted as assessee suo moto recalculated and paid the tax along with interest
ABCAUS Case Law Citation:
ABCAUS 2908 (2019) (05) ITAT
The appeal was filed by the assessee against the order of the Commissioner of Income Tax (Appeals) in confirming levy of penalty under section 271(1)(c) of the Income Tax Act, 1961 (the Act).
The case of the assessee was selected for scrutiny and notice under section 143(2) of the Act was issued.
After considering the details submitted by the assessee, the Assessing Officer (AO) observed that the assessee was employed in two organizations during the previous year but in the return of income had shown the income from one employer only. The TDS reflected in 26AS also showed higher amount than and that declared in the return.
The AO complted the assessment by considering the salary from both the employers and also added interest income credited in the bank account of the assessee to the total income of assessee.
In view of the above, the Assessing Officer initiated penalty proceedings under section 271(1)(c) of the Act on the ground that the assessee had furnished incorrect particulars/concealment.
the Assessing Officer was of the opinion that the act of the assessee amounted to furnishing of inaccurate particulars and liable for levy of penalty and accordingly, he levied penalty under section 271(1)(c) of the Act.
On first appeal, the CIT(A) upheld levy of penalty.
Before the Tribunal the assessee submitted that the he was employed in two organizations. Subsequent to filing the return of income, the assessee noticed that the salary from one employer was inadvertently left while filing returns even though TDS had been deducted.
It was further submitted that the tax was reworked and the assessee paid the differential tax along with interest.
It was further submitted that the Assessing Officer had not found any unaccounted income. Therefore the addition of interest made at the time of assessment did not warrant levy of penalty and prayed for deleting the penalty levied under section 271(1)(c) of the Act.
The Tribunal observed that the case of the assesse was selected for scrutiny and was served notice was served six months after the tax paid by the assessee on the revised computation.
It was noted that admittedly, there was no search or survey in this case out of which the department unearthed any other particulars of income, which was not disclosed by the assessee. It was also not in dispute that before scrutiny notice under section 143(2) of the Act was issued, the assessee had recalculated the tax liability as per the 26AS and paid the tax due along with interest thereon and nothing was left for tax evasion except saving bank interest which was also accepted and paid tax without any dispute.
Under the above facts and circumstances, the Tribunal deleted the penalty levied under section 271(1)(c) of the Act.