Home Case Index All Cases Income Tax Income Tax + AT Income Tax - 2022 (6) TMI AT This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2022 (6) TMI 682 - ITAT AHMEDABADPenalty u/s 271(1)(c) - disallowance of business loss claimed as bad debts - Whether there was no concealment of particulars of its income on the part of the assessee nor the furnishing of inaccurate particulars of such income warranting levy of penalty under Section 271(1)(c) ? - HELD THAT:- Such disallowance made originally at Rs. 1,38,45,181/- by the Assessing Officer was sustained by the Tribunal only to the extent of Rs. 5,02,181/- and while sustaining this very meager amount of disallowance, the claim made by the assessee was not found to be false and it was only that the explanation of the assessee was not found acceptable. As held by the Hon'ble Supreme Court in the case of CIT vs. Reliance Petroproducts P. Ltd [2010 (3) TMI 80 - SUPREME COURT], a mere making of the claim, which is not sustainable in law, by itself, will not amount to furnishing inaccurate particulars of his income attracting the penal provision of Section 271(1)(c) of the Act. Moreover, as held by Hon'ble Gujarat High Court in the case of Director of Income-Tax Vs. Skanska Cementation International Ltd [2016 (7) TMI 1647 - GUJARAT HIGH COURT].when substantial additions on merits have been deleted, nothing survives in favour of Revenue for levy of penalty under Section 271(1)(c). Disallowance u/s 14A r.w.r. 8D - Disallowance made originally by the Assessing Officer at Rs. 17,99,34,022/- was related to the interest to the extent of Rs. 11,04,23,814/- as worked out under Rule 8D(2)(ii). The Tribunal deleted entirely the disallowance on account of interest made as per Rule 8D(2)(ii) and also deleted a further disallowance of Rs. 1,56,62,640/- made under Rule 8D(2)(i). As regards the balance disallowance made under Section 14A as per Rule 8D(2)(iii) on account of common administrative expenses, the Tribunal directed the Assessing Officer to re-compute the said disallowance by taking into consideration only those investments which had actually yielded exempt income to the assessee in the year under consideration. As submitted by the learned Counsel for the assessee at the time of hearing before us and not disputed by the learned DR, the disallowance under Section 14A r.w. Rule 8D(2)(iii), as recomputed as per the direction of the Tribunal, would be less than the suo moto disallowance already offered by the assessee and thus there would be no question of imposing any penalty in respect of disallowance under Section 14A as finally sustained by the Tribunal. Moreover, as held by the Hon'ble Supreme Court in the case of Gruh Finance Limited [2018 (10) TMI 1674 - SUPREME COURT OF INDIA], penalty under Section 271(1)(c) of the Act is not justified in respect of disallowance made under Section 14A of the Act. We, therefore, find no justifiable reason to interfere with the impugned order of the learned CIT(A) cancelling the penalty imposed by the Assessing Officer under Section 271(1)(c) Appeal of revenue dismissed.
|