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2015 (2) TMI 442 - AT - Income TaxPenalty under section 271(1)(c) - disallowance of interest u/s 43B as there is variation between the amount stated to have been adjusted by the assessee to that of amount adjusted by the bank in their books - Held that:- Assessee adjusted towards the interest and did not disallow any amount under section 43B whereas, the said Bank adjusted the amount towards principal, restricting the adjustment to the interest to a smaller amount i.e., to the extent of ₹ 83,51,795/-. A.O. also disallowed only the balance amount in the assessment order invoking the provisions of section 43B, while allowing the above amount. Therefore, principles laid down in the case of Reliance Petro Products Ltd vs. CIT (2010 (3) TMI 80 - SUPREME COURT) equally applies to this as it is only a mere disallowance under provisions of section 43B which resulted in an addition. On these facts of the case, there is neither a concealment of income nor furnishing of inaccurate particulars. Assessee cannot be faulted if the Bank adjusts the amounts towards principal but not towards interest. In these circumstances, assessee’s explanation/actions can be considered as bonafide and accordingly, we are of the opinion that there is no scope for levy of penalty under section 271(1)(c). - Decided in favour of assessee.
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