TMI Blog2015 (11) TMI 848X X X X Extracts X X X X X X X X Extracts X X X X ..... ether the toll road is a "plant" or is 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. 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 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ned order of penalty which is contrary to law, equity and justice and facts and material on record. 2. The learned Commissioner of Income-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. 4. The learned Departmental representative submitted that the facts of the case of the assessee for both the relev ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 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 issue. The assessee has taken the issue to the level of the hon'ble jurisdictional High Court and this shows the bona fide conduct of the assessee as well as the fact that the issue was highly debatable. Merely because the hon'ble High Court ultimately in the quantum appeal of the assessee has decided the issue in favour of the Revenue and has held that the assessee would be entitled to deprec ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nd 2004-05 before the Assessing Officer at the time of assessment itself. 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 between the assessee and the Department with regard to the correct rate of depreciation allowable to the assessee on its toll road and that whether the toll road is a plant or is 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 differ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 'ble Delhi High Court in CIT v. Liquid Investment and Trading Company (supra) clinches the issue in favour of the assessee. In this case it was held by the hon'ble High Court that where the assessee has preferred an appeal under section 260A of the Act which has also been admitted and substantial question of law framed, this itself shows that the issue is debatable. In our considered view no penalty under section 271(1)(c) of the Act could be imposed on a debatable issue. In this view of the order we hold that the case of the assessee is not a fit case for levy of penalty under section 271(1)(c) of the Act and accordingly the grounds of the appeal of the Revenue for the assessment year 2003-04 are dismissed and the grounds of the ap ..... X X X X Extracts X X X X X X X X Extracts X X X X
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