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2016 (3) TMI 366 - ITAT AHMEDABAD

2016 (3) TMI 366 - ITAT AHMEDABAD - TMI - Penalty u/s 271(1)(c) - time limit to levy penalty - Held that:- The penalty order under section 271(1)(c) of the Act ought to be passed before the expiry of the financial year in which the proceedings, in the course of which, action for imposition of penalty has been initiated are completed, or six months from the end of the month in which order of the CIT(A) or the Tribunal is received by the Chief Commissioner or the CIT. In other words, in the presen .....

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s also expired. Even for abundant precaution, we observe that in case on re-verification at the end of the A|O it emerges out that the penalty is within the limitation and there is some communication gap between mentioning of these dates, then, the Revenue will be at liberty to approach the Tribunal to recall this order. Such an application should be filed within the time limit available under the Income Tax Act. With the above remarks, the appeal of the assessee is allowed and penalty is delete .....

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ed under section 271(1)(c) of the Income Tax Act. 3. Brief facts of the case are that the assessee has field its return of income on 31.3.1997 showing NIL income. This return was revised on 24.1.1996 for adjustment of certain claims, but position of income remained NIL only. During the course of assessment proceedings, it was noticed from the statement of income enclosed that the assessee has shown net profit as per audited accounts at ₹ 1,01,51,442/-. The assessee has claimed depreciation .....

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raudulent. Hence, penalty proceedings were initiated. The ld.AO after hearing the assessee has imposed penalty of ₹ 40,56,375/-. The last two paragraphs of the penalty order reads as under: "Another issue on which proceedings for concealment of income were initiated by the A.O was in respect of excess claim of depreciation on factory building. In the original assessment order, the A.O. found that the excess claim of depreciation was made by the assessee to the extent of ₹ 2,50,0 .....

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amounting to ₹ 2,40,754/- was made. In view of the above discussion and legal provisions 1 find that the assessee is guilty of concealment of income and also of furnishing of inaccurate particulars viz. the claim of amounting to ₹ 56,38,059/- being capital expenses on scientific research and development and ₹ 2,40,754/- for depreciation. Therefore, penalty u/s. 271(1)(c) is levied on the assessee. Moreover, keeping in mind the Vanchoo Committee observation that the purpose of p .....

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is time barred, the ld.cousnel for the assessee has placed on record, the details in tabular form. It reads as under: "Particulars Date Original return filed on 30.11.1995 First Revised Return filed by the assessee on 24.01.1996 Survey u/s.133A carried out on 3.01.1997 Second revised return was filed on 29.01.1997 Assessment order u/s.143(3) was passed on 31.3.1997 CIT(A) order was passed on 15.07.1997 Order giving effect to CIT(A) order passed by the AO on 29.09.1999 Penalty order u/s.271 .....

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n where the relevant assessment order or other order is the subject matter of appeal to the CIT(A) or ITAT, within a period before expiry of the financial year in which the proceedings, in the course of which action for the imposition of penalty has been initiated, are completed, or six months from the end of the month in which the order of the CIT(A) or the Tribunal is received by the Chief Commissioner of the Commissioner whichever period is later. He pointed out that proceedings in this case .....

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passed within six months from the receipt of the order of the CIT(A) by the Commissioner or the Chief Commissioner. This order, according to the ld.counsel for the assessee, must have been received before 29.9.1999, because on this date, effect has been given to the order of the CIT(A) by the AO. In order to buttress the authenticity of these dates, he made reference to the penalty order, where the AO has recorded these dates. 7. On the other hand, the ld.DR contended that at this stage he is n .....

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