Penalty for Foreign Asset Disclosure Cannot Be Imposed for Mere Technical Lapse: Bombay HC
Penalty for Foreign Asset Disclosure Cannot Be Imposed for Mere Technical Lapse: Bombay HC
Pr. CIT v. Shrem Alloys Pvt. Ltd. (Bombay High Court) 485(ITR)790
Facts:
1. The assessee acquired foreign assets. Disclosure was made in original returns for AY 2012–13 and 2013–14 (i.e., when assets were acquired) However, in the return filed under Section 153A, disclosure was not in the prescribed format (Schedule FA issue).
2. The Department’s case was that a technical non- compliance results into penalty u/s 271(1)(c) / relevant provision.
Hon Bombay HC held as below:
1. The assessee had already disclosed the foreign assets in the original returns. This was not a case of non-disclosure.
2. A return filed under Section 153A qualifies as a return u/s 139 for disclosure purposes. Non-disclosure in the prescribed format is a procedural lapse, not concealment.
3. The issue was factual and settled. Hence, appeal is hereby dismissed at admission stage.
The copy of the order is as under:
