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2015 (11) TMI 848 - ITAT DELHI

2015 (11) TMI 848 - ITAT DELHI - [2015] 42 ITR (Trib) 280 (ITAT [Del]) - Penalty under section 271(1)(c) - higher rate of depreciation on toll road claimed by assessee - Held that:- The assessee has filed the details of depreciation and also the fact that it has treated the toll road as "plant" and has claimed a higher rate of depreciation at 25 per cent. The assessee has filed an explanation in this regard which could not be said to be not bona fide. This is a case of difference of opinion betw .....

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ion of law. The issue that whether the toll road is a "plant" or a "building" is clearly debatable in nature. Thus no penalty under section 271(1)(c) of the Act could be imposed on a debatable issue. - Decided in favour of assessee. - I. T. A. Nos. 158 /Del/ 2009(assessment year 2003-04) and 67 /Del/ 2009(assessment year 2004-05). - Dated:- 2-6-2015 - G. C. GUPTA (Vice-President) and T. S. KAPOOR (Accountant Member) R. I. S. Gill for the Appellant. S. S. Gupta and Lokesh Gupta, Chartered Account .....

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enue for the assessment year 2003-04 are as under : "1. The order of the learned Commissioner of Income-tax (Appeals) is erroneous and contrary to facts and law. 2. On the facts and in the circumstances of the case the learned Commissioner of Income-tax (Appeals) has erred in deleting penalty imposed under section 271(1)(c) of ₹ 5.50 crores ignoring that the provisions of section 271(1)(c) are attracted in this case as the asses see has filed inaccurate particulars of income by claimi .....

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ncome-tax (Appeals) has erred in law and on facts in upholding imposition of the impugned penalty of ₹ 3,75,00,000 on a national organisation, constituted under an Act of the Parliament engaged in the development of infrastructure for the nation and exempted under section 10(23G) and whose income is exempt from taxation under section 10(23C)(iv) of the Income-tax Act. Renewal of approval is pending with the Director-General of Income-tax (Exemption), Delhi for no fault of the assessee.&quo .....

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d depreciation at 25 per cent. under the head "plant and machinery" treating toll road as the plant although the depreciation was allowable at 10 per cent. only as it was applicable to a "building". He submitted that the assessee has taken the matter in quantum case to the hon'ble High Court and the hon'ble High Court has decided the case against the assessee and held that the assessee was entitled to depreciation at 10 per cent. on toll road and not 25 per cent. as c .....

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was bona fide. He relied on the order of the Assessing Officer. 5. Learned counsel for the assessee has opposed the submission of the learned Departmental representative. He submitted that all the material facts relevant for the assessment were disclosed by the assessee at the time of assessment itself. The conduct and the explanation of the assessee was bona fide. The issue that whether the toll road made by the assessee were "plant" or were "building" is a highly debatable .....

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t the assessee could be held guilty for concealment of income or furnishing of inaccurate particulars of income. Learned counsel for the assessee submitted that in the case of the assessee the issue of higher claim of depreciation at 25 per cent. on the toll road was admitted by the hon'ble High Court being a substantial question of law in the quantum appeals of the assessee and therefore this itself shows that the issue was debatable in nature. He relied on the decision of the hon'ble D .....

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sment year 2004-05 is the first assessment year after the amendment and the assessee's mistake was bona fide and there was no mens rea on the part of the assessee. 6. We have considered the rival submissions and have perused the order of the Commissioner of Income-tax and the Assessing Officer. We find that the assessee has disclosed all the material facts for both the relevant assessment years 2003-04 and 2004-05 before the Assessing Officer at the time of assessment itself. The assessee ha .....

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a "building". It is not a case that the Revenue has gathered some material not disclosed by the assessee. It is a case of furnishing of correct particulars of income, but the difference was in the figure of allowance of deduction on account of depreciation due to the difference in the interpretation of the relevant provision of law. The issue that whether the toll road is a "plant" or a "building" is clearly debatable in nature and it is further proved by the effect .....

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