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2018 (3) TMI 1088 - HC - Income TaxPenalty u/s 271(1)(c) - waiver of loan - disallowance being software expenses. - Held that:- Tribunal found that the parent company of the assessee waived a loan of ₹ 3.41 crores which the assessee reduced from the gross value of assets from the schedule of fixed assets under the Companies Act, 1956. The Tribunal noted that all the facts in relation thereto were disclosed by the assessee. The assessee took a position which the Tribunal held was a possible one. The Tribunal further held that merely because the judgements ultimately took a contrary view it would not warrant the imposition of penalty. There were no mala-fides found on the part of the assessee. Tribunal held that the penalty was also imposed on a disallowance being software expenses. The issue related to the purchase of software by the assessee to carry out its business activities in a more efficient manner. The assessee claimed the same to be revenue expenditure, whereas the Assessing Officer treated the same as capital in nature. The Tribunal noted that a judgement of the Division Bench of the Delhi High Court in CIT Vs GE Capital Services Ltd. (2007 (7) TMI 185 - DELHI HIGH COURT) supported the assessee’s view. The Tribunal found that it was a debatable question and held, therefore, that the imposition of penalty was not justified. - Decided against revenue
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