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2017 (9) TMI 724 - AT - Income TaxPenalty u/s 271(1)(c) - deduction u/s 80IB was claimed on the basis of an audit report signed by a Chartered Accountant - Held that:- Additions were made by the ld. AO, it is evident that on all grounds on which penalty was levied, there is no dispute that the assessee had not suppressed any facts and the claim has been made on the basis of audited accounts and on the basis of audit report, duly signed by the CA. Hence penalty on the ground of concealment of particulars of income could not have been levied. Disallowance of claim of Additional depreciation allowance under Section 32(1)(iia) - higher amount of depreciation allowance in the subsequent years - higher WDV - Held that:- We find that there is no dispute about the fact that assessee had acquired certain plant and machinery which was owned by the assessee and was also put to use during the current year. The assessee is, therefore eligible to claim depreciation thereon under Section 32. However, the assessee had interpreted the term “installed capacity” to mean “total installed capacity” of all units taken together whereas the AO has taken the 'installed capacity' to mean installed capacity of the eligible units only. The impact of this action of the AO is that the appellant will be entitled for higher WDV on this amount and shall be able to claim higher amount of depreciation allowance in the subsequent years. Thus, in view of the above, it is evident that in view of debatable nature of the issue, it cannot be held that inaccurate particulars were filed by the appellant, since the claim of the appellant regarding depreciation allowance was on a different interpretation of the term “installed capacity” as compared to the view taken by the Ld. AO. It is evident that such a view could be debatable and hence in the absence of any inaccuracy in the claim of the appellant, it cannot be held that the appellant had filed inaccurate particulars of income on this issue. Reduction of the amount of deduction under Section 80IB by exclusion of interest income from the computation of eligible profit - Held that:- On careful consideration, as the interest income from deposits made with suppliers and interest from the customers on delayed payment, is derived from the business of the appellant, it cannot be said with certainty that the same had to be taxed under 'Income from Other Sources'. Accordingly, no penalty can be levied on the same. However, since assessee had admitted to treat interest from bank deposits as “Income from Other Sources”, the amount of penalty is restricted to the addition in respect of interest on deposit in bank of ₹ 30,824 only. Disallowance of donation - Held that:- As find that the use of nomenclature “donation” is the root cause of this dispute. This amount comprises of payment of ₹ 16,857 to a widow of an employee of the appellant company, which was incurred for the purpose of maintaining harmonious relationship with the staff and it is more in the nature of “staff welfare” than 'donation'. Regarding the balance amount of of ₹ 6,000, paid to Helpage (India), no receipt was furnished before me. Further, no receipt in respect of other donations of ₹ 2,5OO was filed. In view of the same, the inaccuracy in filing particulars of income was established to the extent of ₹ 8,5OO on this ground. Levy of penalty was rightly confirmed to the extent of inaccurate particulars of income filed by the assessee in respect of income amounting to ₹ 39,324 only by the Ld. CIT(A), which does not need any interference on our part, hence, we uphold the order of the Ldc. CIT(A) on the issue in dispute and reject the grounds raised by the Revenue. Appeal of the Revenue is dismissed.
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