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2014 (11) TMI 1175 - ITAT MUMBAIPenalty u/s 271(1)(c) - Provision for leave encashment u/s 43B disallowed - Held that:- There is merit in the contentions of the assessee. The claim of provision for leave encashment is otherwise allowable as deduction, but for the specific provisions of sec. 43B. Thus, the said claim could not be substantiated in law. Hence, the decision rendered by Hon’ble Supreme Court in the case of Reliance Petro Products (P) Ltd [2010 (3) TMI 80 - SUPREME COURT] shall squarely apply to this claim. In respect of Project expenses, the question whether it was capital expenditure or revenue expenditure is, as submitted by Ld A.R, is a debatable question. It is well settled principle that the penalty u/s 271(1)(c) shall not lie in respect of such deductions, which are debatable in nature. Accordingly, we are of the view that the impugned penalty order could not be sustained. - Decided in favour of assessee
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