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2017 (10) TMI 62 - ITAT DELHIPenalty under Section 271(1)(c) - treatment of reducing the sales consideration in relation to assets of the Daruhera’s unit from the respective block of assets and claiming depreciation on the adjusted block of assets - Held that:- There is no closure of business of the assessee as affirmed by the Hon’ble Delhi High Court and consequently the block of the assets continue to exist, there is absolutely no infirmity in assessee’s treatment of reducing the sales consideration in relation to assets of the Daruhera’s unit from the respective block of assets and claiming depreciation on the adjusted block of assets. Keeping in view of the above stated facts and various pronouncements quoted above, we are of the view this is not a case where there is no closure of business of the assessee same has been affirmed by the Hon’ble Delhi High Court and consequently the block of the assets continue to exist, there is absolutely no infirmity in assessee’s treatment of reducing the sales consideration in relation to assets of the Daruhera’s unit from the respective block of assets and claiming depreciation on the adjusted block of assets. Hence, there is no case of penalty, therefore, Ld. CIT(A) has rightly deleted the same, which does not need any interference on our part, hence, we uphold the same and reject the ground no. 1 raised by the Revenue. Deferred allowance of 4/5th of legal and other expenses on restructuring of business - Held that:- It is settled law that no penalty is leviable in cases where a question of law is admitted in the Hon’ble High Court. Admission of question of law by the Hon’ble High Court on this issue itself shows that the claim of the assessee was legitimate and debatable. Hence, no penalty under section 271(1)(C) is leviable where the issue is debatable and a question of law is admitted by the High Court, hence, we are of the view that Ld. CIT(A) has rightly deleted the penalty on this issue, which does not need any interference on our part, hence, we uphold the same and reject the ground no. 2. Aforesaid Our view is fortified by the decision of the Hon’ble Delhi High Court in case of CIT II vs Liquid Investments and Trading Ltd (2010 (10) TMI 1021 - DELHI HIGH COURT ). Exclusion of miscellaneous income from the claim of tax deduction under section 10A and 10B - Held that:- The assessee had obtained certificates from a Chartered Accountant in Forms 56F and 56G and had thus acted on the basis of an expert advice/opinion for claiming 10A/10B deductions. That the assessee had made adequate disclosure in the audited financial statements, the notes to the computation of income filed along with the return of income. During the course of assessment proceedings, the assesseee had provided the necessary explanations and made due submissions dated 05 December 2008, which were supported by sufficient documentation and guided by judicial decisions. Keeping in view of the detail discussion as above, we are of the view that there is no case of penalty. Hence the minimum penalty imposed by the Assessing Officer was rightly cancelled, which does not need any interference on our part, hence, we uphold the same and reject the ground no. 3.
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