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2016 (11) TMI 1065 - ITAT MUMBAIPenalty u/s. 271(1)(c) - incorrect claim of set off of unabsorbed depreciation - claim voluntarily rectified by filing Revised Computation during the assessment proceedings - Held that:- Claim was made without any personal knowledge or involvement of the assessee. There is uniformity in the averments made by both the above said persons. None of the lower authorities have deemed it necessary to cross examine either of these persons and without their cross examination lower authorities have chosen to disbelieve the averments made on oath by these persons. In our view, the approach followed by the lower authorities is neither fair nor justified. The penal provisions are quite harsh in nature, in as much as, confirmation of the penalty may lead to prosecution of the assessee. Therefore, the revenue officials are expected to observe due diligence in discharge of their legal obligations while levying or confirming the penalty. It appears that approach to the lower authorities in this case has been that since incorrect claim has been made, then penalty must be levied irrespective of the fact whether the incorrect claim was as a result of bonafide mistake or a genuine human error or otherwise. Thus, we find that penalty in this case has been wrongly levied and therefore, same is directed to be deleted. - Decided in favour of assessee.
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