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2014 (3) TMI 398 - DELHI HIGH COURTCancellation of penalty u/s 271(1)(c) of the Act – Manufacturing activity stopped – Claim of depreciation rejected - Held that:- The assessee could not be said to be lacking in bonafide when it made the claim for depreciation because at that stage, its intention to abandon the manufacturing activity was not in fact crystallized – Relying upon Addl. CIT v. Rajindra Flour and Allied Industries P. Ltd. [1980 (9) TMI 75 - DELHI High Court] - the intention of the assessee not to carry-on manufacturing activity was in fact borne out not only in the order in question but also in subsequent orders and that the claim for depreciation was inherent and known - Thus, it attracted Section 271(1)(c) of the Act - The claims of depreciation is also to be viewed in the light of the “block of assets” concept introduced w.e.f. the assessment year 1988-89 – Decided in favour of Assessee.
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