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2018 (4) TMI 268 - HC - Income TaxPenalty u/s 271(1)(c) - provision for retrofitment charges in anticipation of expenditure - Held that:- It has been observed by the authorities below that assesssee had clearly mentioned about the retrofitment expenses in profit and loss accounts for the year ended 31.3.2007 and the provisions for retrofitment expenses under the head, 'current liabilities' in the balance sheet as on 31.3.2007 The explanation furnished by the assessee does not lead to reasonable and positive inference that the assessee's case is false. The assessee was able to show that there was dispute between assessee and M/s Atul Auto Ltd. one of the customers of the assessee. The assessee has created provision for retrofitment charges in anticipation of expenditure and upon the suit being withdrawn, the assessee had offered the amount in the immediately succeeding year i.e. assessment year 2008-09. All these facts would show that the observations of the Assessing Officer that the assessee concealed the fact is not justified. - Decided in favour of assessee
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