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2020 (11) TMI 952 - HC - Income TaxLevy and quantification of penalty and compounding fee - Addition of expenditure incurred as fee for minor deviation from the initially sanctioned plan and to bring the actually constructed structure in conformity with the modified plan as per building bye laws of the assessee on the ground that such payment amounted to penalty not falling under Section 37(1) - HELD THAT:- Admittedly, the first substantial question of law has been answered against the assessee by a Bench of this Court vide order [2013 (10) TMI 1545 - KARNATAKA HIGH COURT] It is also not in dispute that against the aforesaid order, an appeal has been filed which is pending before the Supreme Court. Therefore, in the facts and circumstances of the case, we deem it appropriate to direct the Assessing Officer to give effect to his order with regard to the issue involved in the first substantial question of law Disallowance u/s 14A invoking the provisions of Rule 8D(2)(iii) - HELD THAT:- We we find from the order passed by the Tribunal that the submissions made by the Assessing Officer, particularly in the light of the decision of this Court in the case of CANARA BANK [2014 (1) TMI 1586 - KARNATAKA HIGH COURT] and the decision of the Supreme Court in GODREJ & BOYCE MANUFACTURING CO. LTD. [2017 (5) TMI 403 - SUPREME COURT] have not been considered by the Tribunal. The order passed by the Tribunal as well as the Commissioner of Income Tax (Appeals) insofar as it pertains to the issue involved in the second substantial question of law, is hereby set aside and the matter is remitted to the Assessing Officer to decide the issue involved in the second substantial question of law in the light of the decision above.
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