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TMI Blog2015 (10) TMI 183X X X X Extracts X X X X X X X X Extracts X X X X ..... in nature which need no adjudication. The remaining grounds of the revenue read as under:- "1. On the facts and in the circumstances of the case, the CIT(A) has erred in law and on facts in cancelling the penalty of Rs. 68,56,155/- imposed by the Assessing Officer u/s 271(1)(c) of the Income Tax Act, 1961. 2. On the facts and in the circumstances of the case, the CIT(A) has erred in law and on facts in holding that making claim which is not sustainable in law by itself will not amount to furnishing of inaccurate particulars of income." 2. We have heard arguments of both the sides and carefully perused the relevant material placed on record. Ld. DR submitted that during the quantum proceedings, the assessment was completed u/s 143(3) of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he AO had made disallowance u/s 80IA of the Act in respect of four issues viz. income from software division, income from trading of VSAT equipment, income from interest and service income earned from segment charges. Ld. Counsel further pointed out that the assessee filed an appeal against the assessment order before the CIT(A) and deleted the addition in respect of fourth issue i.e. service income from segment charges of Rs. 25,94,935/- and remaining addition on three counts was upheld by the first appellate authority. Ld. Counsel further submitted that the revenue filed an appeal against the deletion of addition in respect of service income whereby the assessee also filed appeal against the upholding of addition made by the AO on other t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and also filed certificate required for claiming exemption u/s 80-IA(4) of the Act. Ld. counsel further submitted that the issue of claiming deduction in respect of above income is debatable as the CIT(A) has given relief on the one issue and the Tribunal has also given relief on one issue and the Tribunal also found it appropriate to re-examine the second issue of income from software division to the file of the AO for a fresh adjudication, therefore, the issue becomes debatable and controversial and penalty in respect of these issues cannot be levied u/s 271(1)( c) of the Act. 6. Ld. Counsel also placed reliance on the decisions of Hon'ble Supreme Court in the case of Reliance Petroproducts Pvt. Ltd. 230 CTR 320 (SC) and submitted that e ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ourt for a fresh adjudication. Ld. DR fairly pointed out that the department has no serious objection if the issue of penalty on all four grounds is set aside to the file of AO for a fresh adjudication as per outcome of the orders of the respective authorities viz. AO/CIT(A)/Tribunal. 8. On careful consideration of above submissions and facts and circumstances placed by both the parties before us, we are of the considered view that the issue of penalty is consequential to the disallowance/addition made in the quantum proceedings. As per facts submitted by the assessee and fairly accepted by the ld. DR, we observe that all four issues have not attained finality and these are pending before the AO and the Tribunal for a fresh adjudication as ..... X X X X Extracts X X X X X X X X Extracts X X X X
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