Wrong deduction claimed which resulted in reduction of Tax liability can't amount to concealment of income

Last updated: 09 November 2021

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The Bombay High Court has ruled that claiming a wrong deduction, even if it reduces tax liability, does not automatically constitute concealment of income. The case involved Sonu Realtors Private Limited, who claimed a deduction under Section 80 IB. Although the company was later assessed under Section 115JB, the court found no perversity in the tribunal's decision and dismissed the appeal, stating that such claims do not amount to furnishing inaccurate particulars of income.

Court :
Bombay High Court

Brief :
In Pr. Commissioner of Income Tax v. Sonu Realtors Private Limited [INCOME TAX APPEAL NO.956 OF 2017 dated October 11, 2021], Pr. Commissioner of Income Tax ("the Appellant") filed the appeal being aggrieved against Order dated July 20, 2016 passed by Income Tax Appellate Tribunal ("ITAT") in which the order of Appellant was set aside wherein it was alleged by the Appellant that Sonu Realtors Private Limited ("the Respondent") had made an attempt to reduce its tax liability by claiming wrong deduction and the Respondent committed a default of not computing the book profit under Section 115JB of the Income Tax Act, 1961("the IT Act").

Citation :
INCOME TAX APPEAL NO.956 OF 2017 dated October 11, 2021

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Judgement posted by

Bimal Jain

Service

FCA, FCS LLB with21 Yrs of Experience inTaxation Indirect and Direct: Education Qualification: B.Com (Hons) Chartered Accountants Company Secretary LLB Qualified SAP FI/CO Consultants Professional Membership: Chairmanof Indirect Tax Committee of PHD Chamber of Commerce Member of Indirec ... Read more

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