The Mumbai Bench of Income Tax Appellate Tribunal (ITAT) ruled that there is no penalty that could force on the failure to release the considered self-assessment income tax liability because of the fiscal pressures.
“The assessee company, M/s Karanja Terminal and Logistic Pvt. Ltd. had e-filed its return of income for A.Y 2011-12 declaring an income of Rs. 6,86,61,138/-. Thereafter, the assessee on 19.04.2012 filed a revised return of income, declaring an income of Rs. 9,64,16,230/-. The return of income filed by the assessee company was initially processed as such u/s 143(1) of the Act. Subsequently, the case of the assessee was selected for scrutiny assessment u/s 143(2) of the Act.”
Read Also: Process of Income Tax Return Filing without Software
It was seen through the AO that the taxpayer has not been able to furnish its admitted self-assessment tax liability of Rs.3,92,70,237 upon being against the taxpayer vide its reply dated 11.03.2015 furnished that not being able to release its self-assessment tax liability is because of the financial limitation which was started by delay in the start of its project namely Karanja Port development project.
Moreover, it was furnished through the taxpayer that its only income source is the interest obtained through the NBFCs was accounted for on the grounds of the accrual and was not obtainable through it. “Also, the assessee in order to buttress its bonafides to deposit the admitted tax liability,” has furnished to AO who seems to negotiate with the NBFs to disclose the funds and accrued interest. “However, the A.O did not find favour with the aforesaid explanation of the assessee.”
The taxpayer takes the concern in appeal prior to the CIT(A). Prior to the CIT(A), the taxpayer attacked the validity of the order given through the AO. The CIT(A) CIT(A) vacated the penalty imposed by the A.O.
The Coram of Accountant Member, Shamim Yahya, and Judicial Member, Ravish Sood held that as a taxpayer with no fiscal situation to file the self-assessment tax during the time of furnishing of ITR thus there is no penalty under income tax Section 221(1) read with section 140A(3) gets affected on it.
