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2023 (6) TMI 523 - ITAT AHMEDABADLevy of penalty u/s 271(1)(c) - disallowance u/s 14A as per Rule 8D and addition of interest of income tax refund u/s 244A - HELD THAT:- There is no actual finding of any expenses incurred by the assessee for earning exempt income, and it is only on account of computational provision of Rule 8D read alongwith section 14A that the disallowance in the impugned case has been made - Investment made by the assessee was only in one share that too in the preceding year, and there is no finding of any actual incurrence of any expenses for earning income from the shares, the disallowance of expenses being made only on account of the computational provisions provided in the Rules, the assessee in such facts and circumstances, cannot be charged with having concealed or furnished inaccurate particulars of income vis-à-vis the expenses disallowed. Penalty levied on account of the disallowance of expenses being administrative in nature u/s 14A of the Act is we hold not sustainable in law and is directed to be deleted. Levy of penalty - Failure to offer full amount of Interest earned on income-tax refund as taxable income - The same was returned in the succeeding year. - HELD THAT:- it is only under a mistaken belief that the assessee failed to offer interest income during the impugned year, and the assessee otherwise was vigilant to have duly returned whatever interest it received on refund . Assessee in such circumstances cannot said to have concealed or furnished inaccurate particulars of income so as to levy penalty u/s 271(1)(c) - Penalty levied for this component of the addition is also held to be untenable in law, and therefore directed to be deleted. Decided in favour of assessee.
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