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Mangalam Drugs & Organics Ltd. Versus DCIT 4 (2) , Aayakar Bhavan Mumbai

2015 (10) TMI 2174 - ITAT MUMBAI

Penalty u/s 271(I)(c) - disallowances of deduction u/s 80IB - Held that:- The issue with regard to deduction u/s 80IB has been sent to the file of AO by ITAT. In view of these facts, the levy of penalty with respect to this disallowance is hereby cancelled. The AO is at his liberty to initiate the penalty on this issue, after re-deciding this issue

Disallowance on account of interest - Held that:- It is seen by us from the order of ITAT that this disallowance has been deleted. Thus, t .....

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ssesse with rigorous provisions of penalty. - Decided in favour of assessee

AO has made disallowance on the basis of return of income filed by the assessee and audit report of the assessee. The assessee has made its claim in the profit and loss accounts and computation sheet giving complete facts and particulars. Thus, it cannot be said that there was concealment of facts. The assessee had made a claim, duly supported with the audit report from the qualified accountant. The claim was .....

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sessee cannot be fastened with the liability of penalty without there being a clear or specific charge. Fixing a charge in a vague and casual manner is not permitted under the law. Fixing the twin charges is also not permitted under the law. - Decided in favour of assessee - ITA NO.5454/Mum/2011 - Dated:- 24-9-2015 - Shri Joginder Singh, Judicial Member, and Shri Ashwani Taneja, Accountant Member For The Assessee : Shri M. Subramanain (AR) For The Revenue : Mrs. J. K. Garg(DR) ORDER Per Ashwani .....

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owing; (a) That the sum of ₹ 53, 16,657/ - being the amount of disallowances of deduction u/s 80IB was done contrary to the full disclosure and on the basis of report of auditors in Form No.10CCB which was attached with the return of income (b) That the sum of ₹ 3,44,238/- being the amount of disallowance of deductions u/s 80 HHC was also done contrary to the full disclosure on the basis of declaration by auditors which too was attached to the return of income. This amount was not co .....

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hearing, it was brought to our notice by the Ld counsel that the quantum appeal has already been decided by the ITAT and copy of ITAT s order has been placed on record. After hearing both the sides, grounds raised by the assessee are adjudicated as under: 3. Ground No.2(a): The assessee has agitated the action of Learned Commissioner of Income Tax (Appeals) {(hereinafter called as Ld CIT(A)} in confirming the action of AO(hereinafter called as AO ) in levy of penalty on the amount of disallowanc .....

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his liberty to initiate the penalty on this issue, after re-deciding this issue, as may considered appropriate by him, at that stage, as per law and facts. Thus, Ground no.2(a) is allowed for statistical purposes. 4. Ground No.2(c) is: with regard to levy of penalty on wrong claim of ₹ 76,113/-. This ground has not been pressed by the Ld. Counsel and therefore, Ground no.2(c) is dismissed and levy of penalty on this amount is confirmed. 5. Ground No.2(d), is with regard to levy of penalty .....

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owance of ₹ 3,44,238/- being the amount of disallowance of deduction u/s 80 HHC in the quantum appeal. The assessee did not press this ground before the ITAT and it was dismissed by the ITAT without giving any decision of any merits of disallowance. 6.1. We have heard both the sides on this issue and find that penalty would not be leviable with respect to the disallowance made by the AO u/s 80HHC for the following reasons: (i) Similar disallowance was made by the AO u/s 80HHC in assessment .....

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he should not take a different stand in this year and burden the assesse with rigorous provisions of penalty. The revenue is expected to follow some consistency with regard to penal provisions. We derive our support from the judgment of Hon ble Supreme Court in the case of CIT vs. Excel Industries Ltd. 358 ITR 298(SC) for the proposition that consistency should be followed by the Revenue on year to year basis for deciding various issues of the taxpayers. In absence of consistent approach, it may .....

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pported with the audit report from the qualified accountant. The claim was not found allowable by the AO, in his opinion. Under these facts and circumstances, Hon ble Supreme Court in the case of Reliance Petroproducts Pvt Ltd 322 ITR 158(SC), has held that it would not be a fit case for levy of penalty. (iii) It is further seen by us that it is a well known fact that there has been enormous litigation on account of interpretation of section 80HHC, throughout the country, various tax experts and .....

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ssee had made a bonfide claim as per the advice received by it, under these circumstances it cannot be said that the assessee s claim was bogus or wholly erroneous. Under these circumstances, it cannot be said to be a fit case for levy of penalty. (iv) It is further noted, from the perusal of penalty order, that the penalty has been levied, on all the additions/disallowances, in a whole sole manner. The AO has not given his findings, for levying the penalty, for each issue separately, with respe .....

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come within the meaning of section 271(1)(c) of the Act. In our considered view, this approach of the AO for levy of penalty is not correct as per law. Penal provisions are quite harsh, these can make the assessee liable for prosecution, as well. Therefore, the AO is obliged, under the law, to make application of his mind meticulously and carefully for each issue separately and to show and establish precisely and specifically whether there was concealment of income or there was furnishing of ina .....

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