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2012 (10) TMI 899 - ITAT, DELHIPenalty u/s 271(1)(c) - dis-allowance of interest on borrowed funds on the ground that funds were not utilized for the purpose of business - Held that:- It is undisputed that entire material was disclosed by the assessee in the return of income. AO had disallowed interest on borrowed funds on the ground that the funds were not utilized for the purpose of business. Merely because the disallowance has been made would not mean that the case of assessee falls into furnishing of inaccurate particulars of income. CIT(A) while deleting penalty has also held that the assessee had offered an explanation and was able to prove that the explanation was bona fide and all facts relating to the same had been disclosed. Since neither Part-A nor Part-B of Explanation was found to be applicable, in our considered opinion penalty u/s 271(1)(c) is not imposable - Decided in favor of assessee
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