This document summarizes recent developments related to penalties and prosecutions under India's income tax law. It discusses landmark court decisions related to concealment penalties, penalties for failure to comply with certain provisions, and prosecutions for late filing of tax returns. Key cases addressed include those related to concealment penalties for bogus purchases, revised returns, and debatable tax issues.

1. PENALTIES AND PROSECUTIONS
UNDER INCOME TAX- CURRENT
DEVELOPMENTS
CA.V.K.SUBRAMANI.

2. Legal ProvisionsLegal Provisions
An overviewAn overview

3. Landmark DecisionsLandmark Decisions
 PWC v. CIT 348 ITR 306 (SC)PWC v. CIT 348 ITR 306 (SC)
 CIT v. Reliance Petroproducts 322 ITR 158CIT v. Reliance Petroproducts 322 ITR 158
(SC)(SC)
 UOI v. Dharmendra Textiles Processors Ltd 306UOI v. Dharmendra Textiles Processors Ltd 306
ITR 277 (SC)ITR 277 (SC)
 Pfizer Ltd v. ITO (ITA No.1667/2010)Pfizer Ltd v. ITO (ITA No.1667/2010)

4. Concealment penaltyConcealment penalty
 CIT v. Manjunatha Cotton & Ginning Factory (2013)CIT v. Manjunatha Cotton & Ginning Factory (2013)
35 taxmann.com 250 (Kar)35 taxmann.com 250 (Kar)
 Survey U/s.133A and revised return (B.DamodarSurvey U/s.133A and revised return (B.Damodar
Vaman Baliga Jewellers v. Joint CIT (2013) 353 ITRVaman Baliga Jewellers v. Joint CIT (2013) 353 ITR
206 (Kar) / CIT v. Girish Devchand Rajani 33206 (Kar) / CIT v. Girish Devchand Rajani 33
taxmann.com 174 (Guj)taxmann.com 174 (Guj)
 Deliberate wrong claim (CIT v. Morgan Finvest (P)Deliberate wrong claim (CIT v. Morgan Finvest (P)
Ltd 81 DTR 441 (Del) / CIT v. UshaLtd 81 DTR 441 (Del) / CIT v. Usha International LtdInternational Ltd
(ITA No.1696/2006 (Del-HC)(ITA No.1696/2006 (Del-HC)

5. Concealment penaltyConcealment penalty
 Absence of explanation (CIT v. MAK DataAbsence of explanation (CIT v. MAK Data
Ltd 87 DTR (Del) 172) / Bright India BodyLtd 87 DTR (Del) 172) / Bright India Body
Builders v. ITO 82 DTR (Del)(Trib) 186Builders v. ITO 82 DTR (Del)(Trib) 186
 Inadvertent claim (CIT v. Bennette ColemanInadvertent claim (CIT v. Bennette Coleman
& Co Ltd 87 DTR (Bom) 368)& Co Ltd 87 DTR (Bom) 368)
 Change in head of income (CIT v. BennetteChange in head of income (CIT v. Bennette
Coleman & Co Ltd 87 DTR (Bom) 368) /Coleman & Co Ltd 87 DTR (Bom) 368) /
CIT v. Amit Jain 85 DTR (Del) 175CIT v. Amit Jain 85 DTR (Del) 175

6. Concealment penaltyConcealment penalty
 Debatable issue (CIT v.Debatable issue (CIT v.
Jaswinder Singh Ahuja 86 DTRJaswinder Singh Ahuja 86 DTR
(Del) 414)) / Shervani(Del) 414)) / Shervani
Hospitalities Ltd v. CIT 89 DTRHospitalities Ltd v. CIT 89 DTR
(Del) 169(Del) 169
 Admission in survey (CIT v.Admission in survey (CIT v.
S.A.S Pharmaceuticals 335 ITRS.A.S Pharmaceuticals 335 ITR
259 (Del)259 (Del)

7. Concealment penaltyConcealment penalty
• Bogus purchase – Estimated incomeBogus purchase – Estimated income
(CIT v. Mahaveer Mirror Inds. (P)(CIT v. Mahaveer Mirror Inds. (P)
Ltd 353 ITR 553 (Mad))Ltd 353 ITR 553 (Mad))
• Revised return (CIT v. Somany EvergreeRevised return (CIT v. Somany Evergree
Knits Ltd 352 ITR 592 (Bom) /Knits Ltd 352 ITR 592 (Bom) /
Asstt.CIT v. Ashok Raj Nath (ITAAsstt.CIT v. Ashok Raj Nath (ITA
No.2970/2012) (Del)(Trib)No.2970/2012) (Del)(Trib)

8. Concealment penalty
Subsequent SC judgment resulting in
reopening of assessment and validity
of penalty (CIT v. Celetronix Power
India P Ltd 352 ITR 70 (Bom)
Conversion of stock in trade into
investment before sale – CIT v.
Splender Construction 352 ITR 588
(Del)

9. Concealment Penalty
Section 50C – CIT v. Madan Theatres Ltd
88 DTR (Cal) 217.
Unproved v. Disproved explanation -
Saket Agarwal v. ITO (ITA No.3194/2012
(Del)(Trib).

10. Sec. 271A and Sec.271B
CIT v. Babu Reddy 38 DTR (Kar) 147
K.V.Ramachandran v. Dy.CIT 32
taxmann.com 200 (Coch-Trib)

11. Section 271BSection 271B
 Registration U/s.12A and audit U/s.44AB -Registration U/s.12A and audit U/s.44AB -
Urban Improvement Trust v. CIT 83 DTR (Jd.)Urban Improvement Trust v. CIT 83 DTR (Jd.)
(Trib) 282(Trib) 282

12. Sec.271D
Genuineness of loan – CIT v. M.Yesodha
351 ITR 265 (Mad)
Time limit to be computed for levy of
penalty - CIT v. Jitendra Singh Rathore 83
DTR (Raj) 227.
Penalty by CIT(A) – GE India Industrial P
Ltd v. CIT(A) (62 / 2012)

13. Prosecution for late filing of ROI
• Asstt. CIT v. Nilofar Currimbhoy 35
taxmann.com 99 (Del)