No Penalty for mere reduction in deduction claimed

IssueWhether the penalty was imposed U/s 271(1)(c ) because of the reason that the deduction claimed under section 80-IB by the respondent-assessee was ultimately allowed at a lower level were valid?

Held – that the mere making of a claim which is ultimately held not to be sustainable in law, would not amount to furnishing inaccurate particulars regarding the income of an assessee. In the present appeals it is only that the claims of deduction under Section 80IB have been downscaled. This, by itself, would not mean that it is a case of furnishing inaccurate particulars of income. Furthermore, there is no finding in the penalty order as to which part of the income the assessee had concealed and with regard to which particular facet of his income had the assessee provided inaccurate particulars thereof.


Amount paid to seconded personnel not liable for deduction of tax at source

The trained man-power deployed abroad is drawn for the employees of its member companies. However, such deployed man-power continue to be the employees of its member companies but are seconded to the projects abroad by the respondent-assessee company. In the assessment year under consideration, the assessee had claimed an amount of Rs. 3.93 crores as expenditure being the overseas compensation paid to the employees of the oil companies seconded abroad under the head seconded personnel expenses. The assessing officer by his order dated 29th March 2000 disallowed the amount of Rs. 3.93 crores paid to seconded employees on account of its failure to deduct tax at source under Section 192 of the Income Tax Act, 1961 (the Act). Therefore, the payment was hit by Section 40(a)(iii) of the Act.

Seconded personal continue to be the employees on the roll of the member oil companies even during the period of secondment. These seconded employees continue to receive their salaries and emoluments from the member oil company of which they are employees. Therefore, not being employees of the respondent-assessee, the overseas allowances cannot be subject to deduction of tax at source.

Consequently, in view of the finding of fact arrived at that the seconded personnel are not the employees of the respondent-assessee, the amount paid as foreign allowances to the seconded personal is not liable for deduction of tax. In view thereof, the occasion to apply Section 40(a)(iii) of the Act does not arise.


Register / Track PAN Card Related Complain / Status

Income Tax Department has started a website namely Sparsh India to help Assessee to Register their complain related to PAN Card applied through NSDL or UTIISL and they can also check the status of their grievance online.

Nature of Complain may be any of the following:-

Nature of Complaint

  • Neither PAN Number nor PAN Card Received
  • PAN Card Not Received (PAN Number Received)
  • Returned Undelivered (RUD)
  • Name Mismatch
  • Photo Mismatch
  • Father Name Mismatch
  • Other

Assessee can file their complain online at the link given below :-

Assessee can check the status of PAN Grievance at the link given below :-


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