TMI Blog2003 (10) TMI 650X X X X Extracts X X X X X X X X Extracts X X X X ..... n of income on 23rd December, 1991, declaring loss of ₹ 8,26,109. A survey action under section 133A was undertaken for the limited purpose of checking the installation of stenter machine purchased from M/s Gujarat Stenmech (P) Ltd. The machine was dispatched to the assessee on 28th March, 1991. As the machine was 30-40 ft. long, there was suspicion that the machine could not be installed and put to use before 31st March, 1991, as it required special foundation for installation. During the survey under section 133A, Shri M.K. Agarwal, director, in his statement under section 131, stated that the depreciation on this machine was inadvertently claimed which they were now offering for taxation. To this effect, the assessee filed revised ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e to support the imposition of penalty. He also held that the director of the company had made the offer in regard to claim of depreciation voluntarily. He also referred to the guidelines laid down by various rulings of the Supreme Court and High Courts cited by the assessee before him. He finally held that the penalty was not sustainable on facts or in law. Hence, the Revenue has filed the present appeal. 3. The learned Departmental Representative contended that the CIT(A) had erred in cancelling the penalty imposed by the AO. He pointed out that the director had during the survey admitted that depreciation on the stenter machine had been wrongly claimed. He argued that the assessee had filed inaccurate particulars of income and, theref ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... receipts and proof of installation expenses, etc., and the suspicion of the AO regarding installation is without any basis. The AO could not establish anything contrary to the assessee s submissions. He also referred to various judicial decisions and stated that though the assessee may not have used the machinery during the relevant year, but if the same was ready to be used, depreciation should not be disallowed. He further argued that the AO had totally disregarded the facts and the circumstances in which the assessee had agreed to revise the return. In support of his submissions, he drew our attention towards the statement under section 131 of the IT Act, 1961, from Shri Mahendra Agarwal, director, on 9th July, 1992, which is at pp. 25 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion in respect of the stenter machine in the original return cannot, therefore, be regarded as a false or fraudulent claim. The AO mainly relied on the fact that the assessee filed revised return withdrawing the depreciation on the stenter machine after survey operation. In the case of Bangalore Steel Distributors v. ITO [1995] 124 Taxation 94 (Bang.)(Trib.), the Bangalore Bench of the Tribunal has held that penalty for concealment is not leviable in case of revised return filed after survey operation in the absence of anything incriminating found against the assessee in the survey. In the present case, the AO has not brought on record any material or evidence on the basis of which it could be concluded that the assessee had concealed incom ..... X X X X Extracts X X X X X X X X Extracts X X X X
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