TMI Blog2018 (10) TMI 184X X X X Extracts X X X X X X X X Extracts X X X X ..... unearthed during the assessment proceedings so that a reasonable conclusion could be drawn that the assessee either concealed income or furnished inaccurate particulars of income. It is only a question of allowing the depreciation in this year or next year. As a matter of fact if the depreciation is not allowed this year the same will be carried forward and if depreciation is allowed, the loss will be carried forward. In these circumstances, we are of the considered opinion, that there is no element of concealment of income or furnishing of inaccurate particulars of income and the assessee does not stand the gain by claiming depreciation at a higher rate this year. The assessee has neither concealed the income nor furnished inaccurate ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... who vide his order dated 28.1.2011 confirmed the addition of ₹ 7,16,79,068/- on account of depreciation and ₹ 86,224/- on account of internal audit and tax audit fees and deleted the addition of ₹ 1,44,510/- on account licence fee/ rent free accommodation. Aggrieved by the decision of the Ld. CIT(A), the assessee appealed before the ITAT who in turn upheld the order of the Ld. CIT(A). Thereafter, penalty proceedings u/s. 271(1) of the Act were initiated by issuing notice on 04.2.2013. In response thereto, the assessee filed its reply dated 17.10.2012. After considering the response of the assessee, the AO observed that assessee has furnished inaccurate particulars within the meaning of explanation 1 to the sub section (1) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d that assessment was completed at loss of ₹ 2,83,53,768/- against the returned loss of ₹ 10,02,63,570/- by disallowing the depreciation to the tune of ₹ 7,16,79,068/- on account of excessive depreciation and ₹ 86224/- on account of internal and tax audit fees for non deduction of TDS u/s. 40(a) of the Act and AO imposed the penalty of ₹ 2,41,56,197/- u/s. 271(1)(c) of the Act. We find that there is only the application of law as to the depreciation and other disallowance on which no penalty should be maintained. We further note that instead of carry forward loss the action of the AO allows the carry forward of the depreciation. Therefore, all the particulars on which the assessee claimed the depreciation were ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... not acceptable to the Revenue that by itself would not attract the penalty under section 271 (1)(c). 8. In the background of the aforesaid discussions and respectfully following the precedent, as aforesaid, we are of the considered view that the assessee has neither concealed the income nor furnished inaccurate particulars of income and there are no findings of the Assessing Officer and the CIT (Appeals) that the details furnished by the assessee in his return are found to be incorrect or erroneous or false. Under these circumstances, in our view the penalty in dispute is totally unwarranted and deserves to be deleted. Accordingly, we delete the penalty of ₹ 2,41,56,197/- made u/s. 271(1)(c) of the I.T. Act and quashed the orders ..... X X X X Extracts X X X X X X X X Extracts X X X X
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