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2016 (9) TMI 101 - AT - Income TaxLevying the penalty u/s 271(12)(c) - exemption u/s 10(22) - Held that:- It is observed that the assessee was registered under Societies Registration Act in the year 1968. The assessee was also granted exemption u/s 10(22) of the Act vide order dated 27.01.1994 issued by the Director of Exemption, the exemption u/s 10(22) was available to the assessee till Assessment Year 1998-99 as Section 10(22) stood deleted w.e.f. Assessment Year 1999-2000. From the records placed before us, it is observed that the assessee was under a belief that the exemption is available with the assessee under the Act. It was subsequently during the year under consideration that the assessee realized that the exemption is not available. It was during the assessment proceedings for Assessment Year 2004-05 that assessee realized the exemption being not available vide assessment order for the Assessment Year 2004-05 where the Ld. A.O. rejected the assessee’s claim. From the facts of the case, it does not appear that the assessee has deliberately abstained itself from presenting such application in time. In the application dated 31.10.2006 assessee has also claimed for condonation of delay and has requested for registration to be granted w.e.f. 01.04.1999. Considering the above facts, we are of the opinion that the imposition of penalty u/s 271(1)(c) is not justified as there was complete disclosure of facts and the claim made by the assessee was not found acceptable in law. We, therefore set aside the penalty order passed by Ld. A.O.
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