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2017 (10) TMI 1420 - ITAT DELHIPenalty u/s 271(1)(c) - non specification of charge - defective notice - disallowance of depreciation on the ground that the assessee claimed the eligible deduction u/s 24 - Held that:- Notice issued by the AO under Section 274 read with Section 271(l)(c) to be bad in law as it did not specify which limb of Section 271(l)(c) the penalty proceedings had been initiated i.e., whether for concealment of particulars of income or furnishing of inaccurate particulars of income. The Tribunal, while allowing the appeal of the assessee, has relied on the decision of the Division Bench of this Court rendered in the case of COMMISSIONER OF INCOME TAX -VS- MANJUNATHA COTTON AND GINNING FACTORY (2013 (7) TMI 620 - KARNATAKA HIGH COURT). Disallowance of depreciation on the ground that the assessee claimed the eligible deduction u/s 24 and also the depreciation in respect of the very same property. However, the order dated 09.11.2015 passed u/s 154/143(3) of the Act passed by the AO in this matter clearly shows that the AO had considered different properties as such the disallowance was deleted to an extent of ₹ 8,13,742/-. It shows that there was mistaken identity of the property at the time of the assessment proceedings. Further, mere disallowance of depreciation in this peculiar set of facts and circumstances does not invite the proceedings u/s 271(1)(c) of the Act. Ratio of the Hon’ble Apex Court in CIT vs Reliance Petro Products P.Ltd. [[2010 (3) TMI 80 - SUPREME COURT]] applies to the facts of this case at hand and respectfully following the same, we direct the AO to delete the penalty. - Decided in favour of assessee.
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