No Penalty under section 271(1)(c) for difference of opinion as to claim of expenditure

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Penalty under section 271(1)(c)—Concealment or furnishing of inaccurate particulars—Leviability—Non-acceptance of bona fide claim

Facts of the case:

AO made disallowance of provision for liquidated damage and also levied penalty under section 271(1)(c) on said disallowance. Assessee challenged this.



It was undisputed that all the necessary facts and figures were disclosed by assessee in its return of income. The return was accompanied by profit and loss account, balance sheet and relevant schedules. Similarly, no information given in the return was found to be incorrect or inaccurate, therefore, it could not be said that provision made by assessee was disallowed by AO on account of suppression of facts or deliberate concealment of income. It was clear-cut case of difference of opinion between assessee and AO and acordingly AO was not justified in levying penalty under section 271(1)(c).

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