INCOME TAX APPELLATE TRIBUNAL - MUMBAI - RICHA DUBEY VS. INCOME TAX OFFICER

Summarised Judgement (Scroll for Complete Judgement)

Introduction : This appeal, filed by the assesse, being ITA No. 4887/Mum/2014, is directed against the orders dated 23-05-2014 passed by learned Commissioner of Income Tax (Appeals)- 28, Mumbai (hereinafter called “the CIT(A)” ), for the assessment year 2011-12, the appellate proceedings before the CIT(A) arising from the penalty order under section 271(1)(c) of the Income Tax Act, 1961(Hereinafter called “the Act”) dated 20-02-2014 passed by the Assessing Officer(hereinafter called “the AO”).

Facts of the Case : The brief facts of the case are that the assessee is an individual and During the course of assessment proceedings u/s 143(3) read with Section 143(2) of the Act, the A.O. observed that the assessee received salary from M/s. AC Nielson Research Services Pvt. Ltd of Rs. 26,376/- and M/s. Hindustan Unilever Limited of Rs.21,22,182/- totaling Rs. 21,48,558/- during the previous year relevant to the assessment year 2011-12. The AO observed that the assessee offered gross total income to the extent of Rs.2,34,882/- in the return of income filed with Revenue and the total salary has not been declared in the return of income filed with the Revenue.

The amount of Rs. 19,13,676/- (Rs.21,48,558 – Rs.2,34,882) was added to the total income of the assessee as under-declaration of salary income vide assessment orders dated 30-08-2013 passed by the AO u/s 143(3) of the Act and penalty proceedings u/s.271(l)(c) of the Act was also initiated against the assessee for concealment of income and furnishing of inaccurate particulars of income.

Judgement : In our considered view, there is no deliberate attempt on the part of the assessee and it is not a fit case to impose penalty u/s 271(1)(c) of the Act on the assessee as the conduct of the assessee if seen in context of preceding and succeeding years as set-out above does not warrant imposition of the penalty u/s 271(1)(c) of the Act keeping in view peculiar facts and circumstances of the case as set out above as we find that no attempt has been made by the assessee in the preceding and succeeding years as set out above to file incorrect income and make an attempt to claim refund from the revenue , except in the assessment year under appeal which errors have also been duly explained by the assessee by furnishing a bona-fide explanation and every error cannot make assessee liable to penalty u/s 271(1)(c) of the Act. Considering all the facts and circumstances of the case, we delete the penalty levied by the A.O. u/s 271(1)(c) of the Act as confirmed /sustained by the CIT(A).

In the result, the appeal filed by the assessee is allowed.

Order pronounced in the open court on 20th April, 2016.

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Complete Judgement

INCOME TAX APPELLATE TRIBUNAL – MUMBAI - RICHA DUBEY vs. INCOME TAX OFFICER

IN THE INCOME TAX APPELLATE TRIBUNAL "D" BENCH, MUMBAI

BEFORE SHRI AMIT SHUKLA, JUDICIAL MEMBER AND

SHRI RAMIT KOCHAR, ACCOUNTANT MEMBER

I.T.A. No. 4887/ Mum/2014

(Assessment Year : 2011-12)

Mrs. Richa Dubey                                      Income Tax Officer -

C-6 03, Akruti Orchid Park                 26(2)(2),

v.

CHS,                                                     6th floor,

Sakinaka, Andheri (East),                    Dr. K.G. Mittal Ayurvedic

Mumbai - 400 072.                                Hospital,

Charni Road, Mumbai- 40 0 004.

PAN : AIOPD6361R

(Appellant)       ..               (  Respondent)

Assessee by                   Smt. M.K. Patel & Shri K.S. Chokshi

Revenue by :                  Shri B.S. Bist (Sr.DR)

Date of Hearing                       : 8-2-2016

                                 Date of Pronouncement :

O R D E R

PER RAMIT KOCHAR, Accountant Member

This appeal, filed by the assessee, being ITA No. 4887/Mum/2014, is directed against the orders dated 23-05-2014 passed by learned Commissioner of Income Tax (Appeals)- 28, Mumbai (hereinafter called "the CIT(A)" ), for the assessment year 2011-12, the appellate proceedings before the CIT(A) arising from the penalty order under section 271(1)(c) of the Income Tax Act, 1961(Hereinafter called "the Act") dated 20-02-2014 passed by the Assessing Officer(hereinafter called "the AO")..

2 ITA 4887/Mum/2014

2. The grounds raised by the assessee in the memo of appeal filed with the Income Tax Appellate Tribunal , Mumbai (hereinafter called "the Tribunal") read as under:-

"1. (a) The Learned CIT(A) has erred in granting partial relief for levy of Penalty u/ s 271(1)(c) of the Income Tax Act, 1961 without considering the facts and circumstances of the case. The same be deleted.

(b) The Learned CIT(A) has erred in confirming that the assessee has concealed /filed inaccurate particulars of Income whereby the assessee is liable for levy of Penalty u/s 271 (1) (c) of the Income Tax Act, 1961 without considering the facts and circumstances of the case. Hence the penalty be deleted.

(c) The Learned CIT(A) was failed to consider the explanation and the facts put forth by the Assessee with regard to the error incurred in the filing of Tax Returns. The assessee had also explained that this error was identified by the assessee who had sou moto informed the Learned AO and sought assistance to rectify the default. Hence considering the contention of the assessee which was not to evade tax, the penalty confirmed by the Learned CIT(A) be deleted."

3. The brief facts of the case are that the assessee is an individual and During the course of assessment proceedings u/s 143(3) read with Section 143(2) of the Act, the A.O. observed that the assessee received salary from M/s. AC Nielson Research Services Pvt. Ltd of Rs. 26,376/- and M/s. Hindustan Unilever Limited of Rs.21,22,182/- totaling Rs. 21,48,558/- during the previous year relevant to the assessment year 2011-12. The AO observed that the assessee offered gross total income to the extent of Rs.2,34,882/- in the return of income filed with Revenue and the total salary has not been declared in the return of income filed with the Revenue, the amount of Rs. 19,13,676/- (Rs.21,48,558 - Rs.2,34,882) was added to the total income of the assessee as under-declaration of salary income vide assessment orders dated 30-08-2013 passed by the AO u/s 143(3) of the Act and penalty proceedings u/s.271(l)(c) of the Act was also initiated against the assessee for concealment of income and furnishing of inaccurate particulars 3 ITA 4887/Mum/2014 of income. During the course of penalty proceedings u/s 271(1)(c) of the Act, it was submitted by the assessee that it is a clear cut case of negligence on the part of professional online tax return filing portal "Taxspanner" , who were engaged by the assessee for filing her return of income with the Revenue and who have submitted the wrong details of the assessee while filing the assessee's return of income with the Revenue for which the assessee should not be penalized and the assessee has not done anything wrong or incorrect as far as filing of return of income with the Revenue is concerned. The assessee submitted that she has provided her Form No. 16 received from her employer to the website of online tax return filing portal "Taxspanner" and received the confirmation from the said online tax return filing portal "Taxspanner" on 25/06/2011 stating that return of income is filed with the Revenue and the assessee will get ITR-V (acknowledgement of filing of return of income) copy from them in 24 hours. The assessee received the ITR-V from online tax return filing portal "Taxspanner" portal and sent it to the Bangalore CPC of Income Tax Department. The assessee submitted that at that time she was having pregnancy of 5 months and due to immense work pressure in the office she could not devote time to see the contents of return of income filed by the online tax return filing portal "Taxspanner" as she did not understand the form also, hence she just signed the ITR-V and sent it to the Bangalore CPC of Income Tax Department. The assessee submitted that keeping in view of her earlier experience with online tax return filing portal "Taxspanner" portal keeping in view their experience (Taxspanner) in filing the return of income with the Revenue, she did not think about verifying the return of income filed by them. The assessee submitted that in the month of July, 2013, when she visited the A.O.'s office to submit the details relating to scrutiny assessment proceedings u/s 143(3) read with Section 143(2) of the Act, then only she came to know that online tax return filing portal "Taxspanner" has committed a mistake in filing the return of income of the assessee with the Revenue for the assessment year 2011-12 and the income 4 ITA 4887/Mum/2014 filed in the return of income is different from the income reflected in the Form No. 16 received from her employer. The assessee submitted that she realized in July 2013 that the refund of Rs. 4,56,340/- for the assessment year 2011- 12 received form Income Tax Department was wrongly received by the assessee.

During the course of assessment proceedings u/s 143(3) read with Section 143(2) of the Act, the A.O. further observed that the assessee has earned commission income from M/s Buniyad Retail Pvt. Ltd. of Rs. 85,270/- which was not offered for taxation. The said information was received by the AO from AIR information data-base. Since the assessee did not declare the said income of Rs.85,270/- in the return of income filed with the Revenue, the amount of Rs. 85,270 was added to the total income of the assessee vide assessment order u/s.143(3) dated 30/08/2013. During the course of penalty proceedings u/s 271(1)(c) of the Act, the assessee submitted that the assessee has purchased a flat from broker M/s Buniyad Retail Pvt. Ltd. in "Kensington Park" at Jaypee Greens Sector-133 and received commission income of Rs. 85,270/- from M/s Buniyad Retail Pvt. Ltd. The assessee submitted that the said commission received from broker M/s. Buniyad Retail Pvt. Ltd is capital receipt and the same was reduced by her from the cost of the flat purchased through broker M/s. Buniyad Retail Pvt. Ltd in "Kensington Park" at Jaypee Greens Sector-133. The assessee submitted that mere non-acceptance of submission/explanation given by the assessee to the AO does not tantamount to filing of in-accurate particulars or concealment of income as no material has been brought on record by the AO which confirms that the income has been concealed by the assessee.

The A.O. also observed that the assessee has earned interest from savings bank account maintaining with ICICI Bank of Rs. 16,803/- which was not offered for taxation in the return of income filed with the Revenue. The 5 ITA 4887/Mum/2014 amount of interest income from ICICI Bank of Rs. 16,803/- was also added to the total income of the assessee vide assessment order u/s.143(3) dated 30/08/2013. During the course of penalty proceedings u/s 271(1)(c) of the Act, the assessee submitted that during the assessment year 2011-12, the assessee has earned interest income of Rs. 16,803 from savings bank account. The same was not taken in return of income filed with the Revenue due to oversight as the details of interest income were not available at the time of filing of return of income with the Revenue . The assessee submitted that she was under the impression that whatever income received by her has been incorporated in Form 16 and she came to know about the interest income only at the time of scrutiny assessment proceedings u/s 143(3) read with Section 143(2) of the Act. The assessee submitted that she has not done anything willfully or intentionally.

The A.O. rejected the contentions of the assessee and held that the return of income has been signed by the assessee herself, not the online tax return filing portal "Taxspanner". Before signing an important document like ITR-V, the assessee should confirm whether she is signing on the right document or not. Moreover, in its return of income e-mailed to the assessee, the online tax return filing portal "Taxspanner" sent summary of return filed wherein total income was shown as Rs.2,34,882 and refund of Rs. 4,24,500, which the assessee has confirmed by signing it. Therefore, the A.O. held that it is a gross negligence on the part of the assessee. Further, the assessee wrongly claimed that this mistake came notice of her in the month July, 2013 , the intimation dated 24.11.2011 u/s 143(1) of the Act was sent to the assessee and subsequently refund of Rs.4,56,340/- was sent to the assessee vide rectification order dated 13-06-2012 u/s 154 of the Act and it is clear from the facts that the assessee tried to misguide the Revenue and the assessee had mala-fide intention to evade the tax. In support, the A.O. relied on the following decisions:-

i)    Aggarwal Oil & general Mills Ltd. v. CIT, 20 Taxman 383 (Hon'ble Punjab & Haryana High Court)

ii) Pankaj Rathi v. CIT, 13 taxman 115 (Hon'ble Calcutta (High Court) The A.O. also held that the assessee was well aware of the commission income of Rs. 85,270/- received from M/s. Buniyad Retail Pvt. Ltd. before filing of return of income with the Revenue for the assessment year 2011-12 on 26/06/2011, but the assessee did not offer the same for taxation. Such income came to the notice of the A.O. through AIR information data-base only wherein it is shown as commission income. Since Commission income cannot be a capital receipt, the contention of the assessee was rejected by the A.O. Thus, the AO held that the assessee willfully concealed the income from the Revenue.

With respect to interest income of Rs.16,803/- , it was held by the AO that the assessee is a habitual tax evader and even for assessment year 2010-11 in the scrutiny assessment, Rs.8,947/- was added to the income of the assessee. There is no excuse of ignorance of law and it is a willful furnishing of in-accurate particulars of income.

The A.O. held that the assessee also failed to avail the opportunity of filing revised return u/s. 139(5) of the Act. The assessee also did not prefer any appeal against the above assessment order dated 30-08-2013 passed u/s 143(3) of the Act which shows that assessee has no objection for additions made to her income and has accepted that she has filed in accurate particulars of income. The AO held that the assessee case of penalty is covered under Explanation 1(B) to Section 271(1)(c) of the Act.The assessee 7 ITA 4887/Mum/2014 being an educated person drawing salary of more than Rs.20 lacs was aware of consequences of falsifying the facts.

Thus, the A.O. levied maximum penalty u/s 271(1)(c) of the Act @ 300% of the tax so evaded i.e. Rs. 13,04,178/- on the assessee , vide penalty orders dated 20/02/2014 passed u/s 271(1)(c) of the Act.

4.Aggrieved by the penalty order dated 20/02/2014 passed by the AO u/s 271(1)(c) of the Act, the assessee preferred an appeal before the CIT(A).

5. Before the CIT(A), the assessee reiterated the submissions which were made before the A.O. which are not repeated for sake of brevity and submitted that there was no mala-fide intention on the part of the assessee. It is a mistake committed by the online tax return filing portal "Taxspanner" which was engaged by the assessee for filing her return of income with the Revenue and the assessee has never tried to mislead the Revenue and it is a negligence on the part of the online tax return filing portal "Taxspanner" for which the assessee should not be penalized. The assessee submitted that she did not filed revised return u/s. 139(5) of the Act as the time for filing revised return has expired but promptly deposited back the refund amount of Rs.4,56,340/- on 14/08/2013 and the AO was informed of the same on 19- 08-2013. The assessee contended that A.O. is not justified in invoking the explanation 1(B) to section 271(1)(c) of the Act and levying maximum penalty of 300% for a mistake committed by the professional service provider. Similarly, the assessee submitted that the assessee has purchased a flat from broker M/s Buniyad Retail Pvt. Ltd. and received commission income of Rs. 85,270/- from M/s Buniyad Retail Pvt. Ltd. The assessee submitted that the said commission received from broker M/s. Buniyad Retail Pvt. Ltd is capital receipt and the same was reduced by her from the cost of the flat purchased through broker M/s. Buniyad Retail Pvt. Ltd at "Kensington Park" at Jaypee 8 ITA 4887/Mum/2014 Greens Sector-133. The assessee submitted that the above receipt of Rs. 85,270/- is a discount on its investment in the house property which amounts to recovery of capital cost and the assessee has rightly reduced the same from the cost of acquisition of the property. A mere making of the claim which is not sustainable in law by itself will not amount to furnishing of inaccurate particulars of income. The explanations offered by the assessee is bona-fide and there is no mala-fide intention which attract huge penalty of 300% that is the maximum penalty u/s 271(1)(c) of the Act. Similarly, the assessee submitted that inadvertently, the assessee failed to declare the interest received on savings bank account amounting to Rs. 16,803/- and the omission was neither intentional nor willful hence the penalty levied should be deleted.

The CIT(A) after considering the submission of the assessee observed that the return filed by the assessee contains number of inaccurate particulars and income has not been offered to tax fully in respect of salary income, interest income and commission income. The CIT(A) observed that the AO has clearly brought out that the explanation offered in respect of these defaults is neither substantiated nor the bona-fides of the assessee have been established. The online tax return filing portal "Taxspanner" had sent a summary of the return prepared by them to the assessee, along with the ITR-V which the assessee confirmed and signed, without caring to verify it. There is glaring mistake for any tax-payer to have overlooked, especially by any educated person. It is also seen that the assessee received the refund of Rs. 4,56,340/- soon after the order u/s 154 dated 13.06.2012 was passed , which was deposited by her in her bank account. No action was taken by the assessee to intimate the AO or the department about this wrong refund, till her case was taken-up for scrutiny proceedings u/s 143(3) read with Section 143(2) of the Act in June- July 2013. This clearly casts a dark shadow on the bona fides of the assessee. The excuse of being too busy in her office work and of not understanding 9 ITA 4887/Mum/2014 intricacies of Income Tax Law and procedure, is not an excuse. The CIT(A) observed that the assessee cannot shift the blame of inaccurate particulars to the online tax return preparer 'Taxspanner', as firstly it is the responsibility of the assessee to be vigilant and to file correct particulars of income as it is she who verified the return and certified it to be correct and true to the best of her knowledge. Secondly it is clear that the assessee had not intimated the tax preparer about the interest income and the commission income earned by her, which should have been included in the return. The A.O. has correctly brought out that the commission earned by the assessee cannot be treated as capital receipt, especially when the payer of the commission had clearly mentioned the same as commission income of the assessee. The CIT(A) accordingly held that the action of the A.O. in holding that the assessee is liable for penalty u/s 271(1)(c) of the Act is correct. However nothing has been brought on record by the AO to justify the levy of penalty at 300% of the tax sought to be evaded. Penalty of 300% of tax sought to be evaded is levied only in the rarest of the rare cases, which has not been made out to be the case here and the CIT(A) directed the A.O. to restrict the levy of penalty at 100% of the tax sought to be evaded, vide orders dated 23-05-2014.

6. Aggrieved by the orders dated 23-05-2014 passed by the CIT(A), the assessee preferred an appeal before the Tribunal.

7. The ld. Counsel for the assessee submitted that the A.O. has levied penalty at the rate of 300% of the tax sought to be evaded which is the maximum penalty u/s. 271(1)(c) of the Act, while the CIT(A) reduced the afore-stated penalty to 100% of the tax sought to be evaded and allowed part relief to the assessee. The ld. Counsel submitted that the assessee filed return of income through online tax return filing portal "Taxspanner". Apparently there was an error committed by the online tax return filing portal "Taxspanner". There was calculation error in computing salary income . The 10 ITA 4887/Mum/2014 assessee's counsel submitted that she is a salaried employee and received salary from M/s. AC Nielson Research Services Pvt. Ltd of Rs. 26,376/- and M/s. Hindustan Unilever Limited of Rs.21,22,182/- totaling Rs. 21,48,558/- during the year. The said online tax return filing portal "Taxspanner" was duly furnished the copies of form no 16 / salary details received from the employers. The said tax filing online tax return filing portal "Taxspanner" punched salary received from Hindustan Lever Limited as 'Rs.2,09,614/-' by mistake instead of correct salary of 'Rs.20,96,914/-' and also the said online portal did not take into effect any other income of (-) Rs.1,51,726/- reported by the assessee and hence the error in filing the return of income with the revenue. The details are placed in paper book filed with the Tribunal. The ld counsel submitted that due taxes has been duly deducted at source by both the employers as applicable as per the Act. There was no mala-fide intention on the part of the assessee to evade taxes. There is negligence on the part of the online tax return filing portal "Taxspanner". The assessee was pregnant at that time and due to work pressure etc., she trusted the work of filing online return to online tax return filing portal "Taxspanner" and did not check the details sent by the said online portal before signing and sending the same to Income Tax Department at CPC Bangalore. The said online tax return filing portal "Taxspanner" also filed return of income for the earlier year on behalf of the assessee. It is a mistake committed by the online tax return filing portal "Taxspanner" and the assessee has never tried to mislead the Revenue and it is a negligence on the part of the online tax return filing portal "Taxspanner" for which the assessee should not be penalized. The assessee's counsel submitted that the refund order received by the assessee was deposited with the bank and assessee did not pay much attention to check the details as she was busy with new born baby and with her work at the time of receiving of refund.She came to know about the mistake in July 2013 when she visited office of the AO in connection with scrutiny proceedings and immediately on realizing the mistake committed by the online tax return filing portal 11 ITA 4887/Mum/2014 'Taxspanner" , she immediately deposited the said refund of Rs.4,56,340/- to the credit of Government on 14/08/2013 and intimated to the AO on 19/08/2013. The copy of challan is placed in paper book filed with the Tribunal. The ld counsel submitted that by the time she realized the mistake , the time for filing revised return u/s. 139(5) of the Act had already expired. The ld. Counsel contended that A.O. is not justified in invoking the Explanation 1(B) to section 271(1)(c) of the Act and levying maximum penalty of 300% for a mistake committed by the professional service provider. Similarly, with respect to the commission income, the assessee counsel submitted that the assessee has purchased a flat from broker M/s Buniyad Retail Pvt. Ltd. and received discount as commission of Rs. 85,270/- from M/s Buniyad Retail Pvt. Ltd which is certified by the said Buniyad Retails Private Limited which is placed at page 17 paper book filed with the Tribunal . The assessee submitted that the said discount as commission received from broker M/s. Buniyad Retail Pvt. Ltd is capital receipt and the same was reduced by the assessee from the cost of the flat purchased through broker M/s. Buniyad Retail Pvt. Ltd in "Kensington Park" at Jaypee Greens Sector-

133. The assessee submitted that the above receipt of Rs. 85,270/- is a discount on its investment in the house property which amounts to recovery of capital cost and the assessee has rightly reduced the same from the cost of acquisition of the property. A mere making of the claim which is not sustainable in law by itself will not amount to furnishing of inaccurate particulars of income or concealment of particulars of income. The explanations offered by the assessee is bona-fide and there is no mala-fide intention which attract huge penalty of 300% of tax sought to be evaded that is the maximum penalty u/s 271(1)(c) of the Act. Similarly, the assessee submitted that inadvertently, the assessee failed to declare the interest received on savings bank account with ICICI Bank amounting to Rs. 16,803/- and the omission was neither intentional nor willful , hence the penalty levied should be deleted. The ld. Counsel relied upon the decision of 12 ITA 4887/Mum/2014 Hon'ble Andhra Pradesh High Court in the case of CIT v. Ms. Sania Mirza, [2013] 40 taxmann.com 17 (AP) and also the decision of Hon'ble Supreme Court in the case of Price Water House Coopers P. Ltd. v. CIT (2012) 25 taxmann.com 400 (SC). The assessee in case law paper book filed with the Tribunal has also relied upon decisions of Hon'ble Supreme Court in the case of CIT v. Reliance Petroproducts Limited (2010)189 Taxman 322(SC), decision's of Tribunal, Mumbai in Mimosa Investment Co. Private Limited v. ITO (2009) SOT 470(Mum.Trib) and VIP Industries Limited (2009) 30 SOT 254(Mum.Trib.)

8. The ld. D.R., on the other hand, submitted that the assessee has duly signed the return of income filed with revenue including verification/declaration contained therein that it contains all information which is true and correct. The assessee was granted refund also in June 2012. The assessee did not come forward to deposit back the money so received as refund from the Government. She should have come forward voluntarily of her own to deposit the money refunded to her. If this case would not have come in scrutiny u/s 143(3) read with Section 143(2) of the Act, then the assessee would not have deposited the amount with Government Treasury, which was refunded to her by the Revenue. In support, the ld. D.R. relied upon the decision's of Hon'ble Supreme Court in the case of Mak Data Private Limited v. CIT (2013) 38 taxmann.com 448(SC) and UOI v. Dharmendra Textile Processors (2008) 13 SCC 369(SC).

9. We have considered the rival contentions and also perused the material available on record including the judicial pronouncements cited by both the parties. We have observed that the assessee is a salaried employee and received salary from M/s. AC Nielson Research Services Pvt. Ltd of Rs. 26,376/- and M/s. Hindustan Unilever Limited of Rs.21,22,182/- totaling Rs.

21,48,558/- during the year. There was an error/mistake in punching salary, while filing return of income, received by thee assessee from Hindustan Lever Limited as 'Rs .2,09,614/-' by mistake instead of correct salary of 'Rs.20,96,914/-' and also not taking into effect any other income of (-) Rs.1,51,726/- reported by the assessee and hence the error in filing the return of income with revenue. The details are placed in paper book filed with the Tribunal. The assessee had submitted that she engaged the services of online tax return filing portal "Taxspanner" whom the assessee gave all the details of her income and the said online tax return filing portal "Taxspanner" committed above mistake's due to their negligence while filing return of income of the assessee with the Revenue. We have observed that it is stated by the assessee that she has provided her Form No. 16 received from her employer to the website of online tax return filing portal "Taxspanner" and received the confirmation from the said 'Taxspanner' on 25/06/2011 stating that ITR-V is filed and assessee will get ITR-V (acknowledgement) copy from them in 24 hrs. It is stated that the assessee received the ITR-V from the said 'Taxspanner' and sent it to the CPC Bangalore, Income Tax Department. The assessee submitted that at that time she was having pregnancy of 5 months and due to immense work pressure in the office she could not devote time to see the content of ITR filed by the said 'Taxspanner' as she did not understand the form also, hence she just signed the ITR-V and sent it to the Bangalore CPC of Income Tax Department. The assessee submitted that keeping in view of her earlier experience with the said 'Taxspanner' as well as their experience in filing the return of income, she did not think about verifying the return of income filed by them. The assessee has also filed copies of acknowledgment of filing return of income for the period commencing from assessment year 2009-10 to 2015-16. From the perusal of the said acknowledgement's of return of income, we find the details of returned income.

The perusal of the above chart shows that the assessee had claimed refund of taxes only in the assessment year 2011-12 under appeal and in the last seven years spanning from assessment year 2009-10 to 2015-16 except assessment year 2011-12, no attempt has been made by the assessee to claim refund of taxes from the Revenue. The assessee derives income mainly from salary and her salary income is subjected to deduction of tax at source and she could under normal circumstances gain by filing in-accurate particulars / concealment of income by way of claiming refund of taxes from revenue. The above chart clearly shows that the conduct of the assessee is bona-fide and it is due to the error and mistake in the assessment year 2011- 12 as contended by the assessee , return of income was wrongly filed .As soon as the assessee came to know about the error/mistake , she immediately took steps to deposit back the refund of taxes so received with the Government Treasury on 14-08-2013 and intimated the AO also vide letter dated 19-08- 2013. We find that the conduct of the assessee is bona-fide and there is no mala-fide intention on the part of the assessee although error/mistake took place in filing return of income for assessment year 2011-12 under appeal. If 15 ITA 4887/Mum/2014 the assessee would have been 'habitual tax evader' as contended by the Revenue , then her conduct would have shown that she is regularly seeking refund of taxes by filing erroneous return of income by concealing her income or furnishing inaccurate particulars of income which the above chart clearly shows otherwise , whereas the return of income till assessment year 2012-13 were all filed as set out above before the issuance of notice u/s 143(2) of the Act by the Revenue for the assessment year 2011-12 on 31.08.2012. Further, the assessee salary income was subjected to deduction of tax at source by her employers and the employer also intimate the Revenue about the gross salary paid and tax so deducted at source on such salary by filing quarterly return of TDS in form 24Q and thus, the revenue is fully aware of the salary income of the tax-payer in its data-base. The employers issue form no 16 to employees whereby all the salary details are furnished along with details of tax deducted at source and hence it is not possible under normal circumstances for a salaried employee to evade taxes by filing in-accurate salary particulars or concealing salary income in the return of income as the mismatch in the information furnished by the tax-payer vide return of income vis-à-vis information with Revenue in its database will be captured by the Revenue. We have seen that the authorities below have used the strong words like 'habitual tax evader' against the assessee which in our humble and respectful submissions are not correct observations of the authorities below and we direct that all such words used by the authorities below stand expunged from the orders of the authorities below. The citizens and the tax- payers of this country are participant in the nation building and also contributor to the exchequer and to use such harsh words against them are not warranted except in exceptional proven cases. In our considered view , the conduct of the assessee was not mala-fide and contemptuous and the assessee had come forward by offering a bona-fide explanation about the error committed by the online tax return filing portal 'Taxspanner' and hence in our considered view, the assessee is not liable for penalty u/s 271(1)(c) of 16 ITA 4887/Mum/2014 the Act as the case is covered by the exceptions as contained in the explanation 1(B) to Section 271(1)(c) of the Act.

Even with respect to the discount as commission income received by the assessee, the assessee has purchased a flat from broker M/s Buniyad Retail Pvt. Ltd. and received discount as commission income of Rs. 85,270/- from M/s Buniyad Retail Pvt. Ltd. and the assessee submitted that the said discount as commission income received from broker M/s. Buniyad Retail Pvt. Ltd is capital receipt and the same was reduced by the assessee from the cost of the flat purchased through broker M/s. Buniyad Retail Pvt. Ltd in "Kensington Park" at Jaypee Greens Sector-133. The view adopted by the assessee is a plausible bona-fide view although the same did not found favour with the Revenue and the assessee chose not to file appeal against the said additions but that does not mean that every claim which is not sustained by the revenue will make the tax-payer liable to penalty u/s. 271(1)(c) of the Act. The claim of the assessee was plausible and bona-fide and we hold that no penalty can be imposed u/s 271(1)(c) of the Act on this count.

With respect to the amount of Rs. 16,803/-, it was stated that inadvertently the assessee failed to declare the interest received on savings bank account amounting to Rs. 16,803/- and the omission was neither intentional nor willful.The amount involved is also trivial.

In our considered view, there is no deliberate attempt on the part of the assessee and it is not a fit case to impose penalty u/s 271(1)(c) of the Act on the assessee as the conduct of the assessee if seen in context of preceding and succeeding years as set-out above does not warrant imposition of the penalty u/s 271(1)(c) of the Act keeping in view peculiar facts and circumstances of the case as set out above as we find that no attempt has been made by the assessee in the preceding and succeeding years as set out 17 ITA 4887/Mum/2014 above to file incorrect income and make an attempt to claim refund from the revenue , except in the assessment year under appeal which errors have also been duly explained by the assessee by furnishing a bona-fide explanation and every error cannot make assessee liable to penalty u/s 271(1)(c) of the Act. Considering all the facts and circumstances of the case, we delete the penalty levied by the A.O. u/s 271(1)(c) of the Act as confirmed /sustained by the CIT(A). We order accordingly.

10. In the result, the appeal filed by the assessee in ITA N0. 4887/Mum/2014 for the assessment year 2011-12 is allowed.

Order pronounced in the open court on 20th April, 2016.