23 April 2010
i hv recd the penalty notice u/s.271(1)(c), at the time hearing ito found the contra entry on a particular date actually it was deposited on a different date to bank but by mistake in books the amount was taken on a particular date. so ito has consider in unexplain cash credit and for which already tax has been paid . but after that we have received one more notice regd penalty so i want to know whether we can able to give any explanation in writting and avoid the penalty or it has to be paid. kindly reply me earliest regd this at my mail id : shrnk_raj@yahoo.co.in
10 August 2024
To address a penalty notice under Section 271(1)(c) of the Income Tax Act due to a discrepancy in cash credit entries, it's essential to provide a detailed and accurate explanation to the Assessing Officer (AO). Below is a draft letter you can use to respond to the penalty notice.
Please note that this is a general template and should be customized based on the specifics of your case and additional guidance from your tax consultant or legal advisor.
I am writing in response to the penalty notice issued under Section 271(1)(c) of the Income Tax Act, 1961, pertaining to the assessment for the financial year [Assessment Year]. The notice addresses an issue of cash credit discrepancy that occurred due to a clerical error in recording the date of deposit.
I would like to provide the following explanation:
1. **Nature of the Discrepancy:** The discrepancy arose due to a mistake in recording the date of deposit of [amount] in the books of accounts. The actual deposit was made on [correct deposit date], but due to an oversight, it was recorded in the books on [incorrect date]. This was a genuine clerical error and not an attempt to conceal income or evade taxes.
2. **Tax Liability:** It is important to note that the tax on the entire amount in question has been duly paid, and the corresponding tax liability has been discharged. The discrepancy was merely related to the date of entry and did not involve any additional unaccounted income or tax evasion.
3. **Intent and Cooperation:** I have always aimed to comply with tax regulations diligently and promptly. As soon as the discrepancy was identified, the correct details were incorporated into the records, and tax was paid accordingly. This shows that there was no intentional concealment of income but rather an error that has been rectified.
4. **Request for Consideration:** Given that there was no intention to conceal income and that the tax on the amount in question has been paid, I respectfully request that the penalty under Section 271(1)(c) be reconsidered in light of the explanations provided. The error was purely clerical, and I have cooperated fully by rectifying the mistake and ensuring tax compliance.
I am enclosing copies of the relevant documents, including the corrected entries, proof of tax payment, and any other supporting materials that may assist in understanding the nature of the error.
I kindly request you to review the provided explanation and documentation. I would appreciate your consideration in waiving or reducing the penalty imposed, given the circumstances outlined.
Thank you for your understanding and consideration of this matter. Please let me know if any further information or documentation is required.
**Yours sincerely,**
**[Your Name]** **[Designation/Position, if applicable]** **[Contact Number]**
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**Enclosures:** 1. Copy of the corrected entries 2. Proof of tax payment 3. Any other supporting documents
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### **Additional Tips:**
1. **Consult a Tax Professional:** Before sending the letter, it's advisable to consult with a tax professional or legal advisor to ensure the response is accurate and comprehensive.
2. **Submit Timely:** Ensure that the response is submitted within the time frame specified in the penalty notice to avoid any further complications.
3. **Follow Up:** Keep a copy of the submitted letter and follow up with the tax office if you do not receive a response within a reasonable time.
This draft should help you provide a clear explanation and request a reconsideration of the penalty.
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