TMI Blog2014 (1) TMI 910X X X X Extracts X X X X X X X X Extracts X X X X ..... ing upon CIT Vs. Mother India Refrigeration Pvt. Ltd. [1985 (8) TMI 2 - SUPREME Court] - legal fictions are created only for some definite purpose and they must be limited to that purpose and should not be extended beyond that legitimate field - Further in CIT Vs. Reliance Petro Products Pvt. Ltd. [2010 (3) TMI 80 - SUPREME COURT] - merely because the Assessee has claimed the expenditure, which claim was not accepted or was not acceptable to the Revenue, that by itself would not, attract penalty u/s 271(1)(c) – there was no reason to interfere with the order of CIT(A) – Decided against Revenue. - ITA No 62/A/2013 - - - Dated:- 5-7-2013 - Shri Mukul Kr. Shrawat J.M. And Shri Anil Chaturvedi, A.M.,JJ. For the Appellant : Shri T. Sank ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ng the submissions made by the Assessee granted partial relief to the Assessee by holding as under:- 5. I have perused the facts of the case as discussed above. I have perused various case laws relied on by appellant. After careful consideration of facts, submission and contention of both A.O. as well as appellant, I am inclined to accept the contention of the appellant that as far as disallowance u/s.40(a)(ia) of ,the I.T. Act are concerned for non- compliance of IDS provisions, satisfaction of A.O. for furnishing inaccurate particulars of income is not justified. I am inclined to accept the appellant's contention that ratio of various case laws relied on by appellant are squarely applicable in the case of appellant for the penalty impos ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e penalty of Rs. 11,43,044/- levied u/s. 271(1)(c) of the Act. 6. Before us, the learned D.R. relied on the order of Assessing Officer. The learned A.R. on the other hand submitted that the Assessee was under bona fide belief that the provisions of TDS were not applicable on interest paid to NBFC. He further submitted that the genuineness of payment of interest was not in doubt and the disallowance has been made under the deeming provisions of Section 40(a)(ia). The learned A.R. further submitted that the legal fiction created by section 40(a)(ia) cannot be extended beyond the disallowance of expenditure and cannot be applied for invoking the provisions of section 271(1)(c). He also placed reliance in the decision of CIT vs. Reliance Petr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... al fiction created by section 40(a)(ia) will not attract penalty for furnishing of inaccurate particulars of income because there is no inaccurate particulars in the return of income. 9. The Hon. Supreme Court, in the case of CIT Vs. Mother India Refrigeration Pvt. Ltd. (1985) 155 ITR 711 (SC) has held that legal fictions are created only for some definite purpose and they must be limited to that purpose and should not be extended beyond that legitimate field. 10. The Hon. Apex Court in the case of CIT Vs. Reliance Petro Products Pvt. Ltd. (2010) 322 ITR 158 (SC) has held that " merely because the Assessee has claimed the expenditure, which claim was not accepted or was not acceptable to the Revenue, that by itself would not, attract pe ..... X X X X Extracts X X X X X X X X Extracts X X X X
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