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TMI Blog2012 (3) TMI 77X X X X Extracts X X X X X X X X Extracts X X X X ..... 2.12.2003. The assessee company had debited filing fee paid to Registrar of Companies (ROC) amounting to Rs.980500/- and stamp duty paid of Rs.66458/-. The Assessing Officer, however, did not allow these two claims of expenditure. It was held that the assessee had not offered any explanation as to why the said two items of expenditure were to be treated as revenue expenditure. 3. In the penalty order, it was held that the assessee had made a false claim of disallowable expenses, since the Hon'ble Supreme Court had held in the case of "M/s Brooke Bond (India) Ltd. vs. CIT", 225 I.T.R. 798 (SC), that the two items of expenditure were capital in nature; and that the assessee had understated its profit and had furnished inaccurate parti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... g at pages 14- 22 of the assessee's paper book ("APB", for short), there was a deduction of Rs.89,400/- u/s 35D of the Act and so, the assessee Company was in full knowledge of the actual state of affairs. Reliance was placed on "CIT vs. Gurbachan Lal", 250 I.T.R. 157 (Del.) and "ACIT, Central Cir.29 vs. Supreme Industries Ltd.", 28 SOT 19 (Mum.). The ld. DR has contended that the claim made was patently incorrect and so, the penalty was rightly levied on the assessee. 7. The Ld. Counsel for the assessee, on the other hand, has strongly supported the impugned order. It has been submitted that the claim of the assessee was bona fide and mistake, if any, was a bonafide mistake; that mere omission in the return of income, to claim an item of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that the issue of nature of such expenditure has been the subject matter of long drawn fiercely fought litigation; that even the auditors gave no indication in this regard; that the assessee is not a person instructed in law, nor is it expected of any one to know the entire law; that moreover, nothing has been brought on record to show that the assessee had furnished inaccurate particulars of its income; and that therefore, there being no merit in the appeal filed by the department, the same be ordered to be dismissed. The ld. Counsel for the assessee has placed reliance on certain case laws which we shall presently discuss. 8. We have heard the parties and have perused the material on record. The assessee limited Company was incorporated ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... noted by the CIT(A) at page 4, para 14 of the impugned order. A copy thereof is to be found at pages 7-11 of the APB. It would be appropriate to reproduce hereunder the relevant portion of the said reply: "2. Not furnished inaccurate particulars - (a) An expenditure which is the part of P/L A/c was added back to computation of income for the purpose of Tax calculations, cannot be said that it was a indulged in positive concealment of income or furnishing inaccurate particulars of income. Since the expenditure incurred on filing fees for increase in authorised capital was a capital expenditure and added back to income, in computation. In the case of CIT vs. Indian Metal & Ferro Alloys Ltd., 117 ITR 378 (Ori) - There may be particulars as p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as bonafide and all the facts relating to it were apparently disclosed in the profit and loss account and also furnished before the Ld. Assessing Officer at the time of assessment proceedings. There was no willful negligence on the part of assessee..........." 10. The assessee, in its aforesaid reply, placed reliance on numerous judgments. In the penalty order, however, the Assessing Officer has not even as much as made mention of the said reply filed by the assessee. This, despite the fact that the copy of the reply dated 31.8.06 filed before us bears a stamp of the Office of ACIT, Circle 16(1), New Delhi, proving the fact of this reply having indeed been filed before him. On the contrary, by way of the last sentence of the second para on ..... X X X X Extracts X X X X X X X X Extracts X X X X
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