- (1.) The substantial question of law under adjudication in this appeal is that : "Whether on the facts and in the circumstances of the case, the Income Tax Appellate Tribunal was justified in confirming the penalty imposed upon the appellant-assessee under Section 271 (1)(c) of the Income Tax Act, 1961 when the claim of the assessee was a debatable one and there was no specific finding that the assessee had submitted false or incorrect accounts ?" In brief, facts of the case are that the appellant-assessee filed its return of income on 15.2.1996 declaring total income of Rs.7490/-. The assessee sold one Dal Mill in the year previous to the assessment year for a consideration of Rs.19,14,000/-. The assessee, however, did not declare any profit/ short term capital gain on the sale of Dal Mill by treating that as a long term capital gain. As per record, Return Down Value (WDU) of Dal Mill as on 1.4.1994 was Rs.9,57,482/-. The assessee claimed depreciation on the Dal Mill during the assessment year 1985-85 to 1987-88, the same being depreciable asset. As already stated, the sale consideration for the Dal Mill was Rs.19,14,000/- and the return down value of that as on 1.4.1994 was Rs.9,57,482/-. The assessee, as such, gained Rs.9,56,518/- but that was not declared in return of income filed. An action under Section 147 read with Section 148 of the Income Tax Act, 1961, thus, was initiated and the Asessing Officer made certain additions. The additions so made came to be affirmed by the Commissioner of Income Tax and also by the Income Tax Appellate Tribunal.
(2.) A notice as per Section 274 read with Section 271 (1)(c) of the Act of 1961 was issued and the assessee in response thereto stated that it being a Co-operative Society is under the control of Government of Rajasthan and, therefore, the Dall Mill was sold with prior approval and sanction of the competent authority. As per the assessee, in the return of income it disclosed the transaction regarding sale of Dal Mill and also relating to sale of mill in the computation of income filed with the return of income. There was no concealment of particulars of income or submission of inaccurate particulars of income and the additions were made only on the basis of difference of opinion. The Assessing Officer did not accept the explanation and held that the assessee concealed its income from capital gains and also furnished inaccurate particulars of income that attracts provisions of Section 271(1)(c) of the Act of 1961, therefore, levied penalty @ 150% of on the total income concealed.
(3.) The appeal giving challenge to the order passed by the Assessing Officer came to be dismissed vide order dated 7.10.2010. The Commissioner of Income Tax (Appeals) while affirming the order passed by the Assessing Officer observed that the appellant failed to produce material evidence to substantiate its explanation that the claim made in return of income was bonafide one. The learned Commissioner of Income Tax accepted the finding given by the Assessing Officer that the instant one was not a case of difference of opinion, but relating to concealment of income and submission of inaccurate particulars of income. The appeal preferred by the assessee before the learned Income Tax Appellate Tribunal also came to be dismissed by the order dated 14.9.2012 with a finding that the Dal Mill sold was a part of block of assets and the assessee claimed depreciation thereon from beginning till the year 1987 and the fact that the assessee is a Co-operative Society is not sufficient to absolve it from penal provisions as per Section 271 (a)(c) of the Act of 1961.;