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2022 (8) TMI 781 - AT - Income TaxPenalty proceedings u/s. 271(1)(c) - addition on account of sundry creditors - HELD THAT:- This amount has been deleted by the ITAT in the quantum appeal against the order of Ld. CIT(Appeals) in the assessee's own case [2020 (7) TMI 94 - ITAT AHMEDABAD] - Since the issues has been decided in favour of the assessee by IT AT in quantum proceedings, penalty u/s. 271(1)(c) of the Act is hereby directed to be deleted. Addition being the expenditure incurred for increase in the authorised share capital - We are of the considered view that even if the assessee did not press this issue in quantum proceedings before Ld. CIT(Appeals), since various Tribunals have held that expenses incurred towards increased in authorised share capital is eligible for deduction under section 35D of the Act, and therefore since the issue is debatable one, hence penalty u/s. 271(1)(c) of the Act on this issue is hereby being set aside. Addition as per AIR information - Addition has been made purely on account of the AIR report and no income has been received by the assessee. In our considered view, looking at the quantum of addition, and in view of the fact that the assessing officer has not been able bring anything on record to substantiate that this amount either accrued to the assessee/or has been received by the assessee, but relied only on the AIR report to hold the assessee has under-reported this income, in the interests of justice, we are hereby deleting the addition u/s. 271(1)(c) of the Act. Appeal of assessee allowed.
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