TMI Blog2016 (7) TMI 1183X X X X Extracts X X X X X X X X Extracts X X X X ..... the following ground of appeal :- That on the facts and in the circumstances of the case, the ld. CIT (A) is wrong, unjust and has erred in law in confirming penalty of ₹ 24,20,000/- imposed by the ld. Assessing Officer u/s 271(1)(c) of the I.T. Act, 1961. 2. Briefly stated the facts are that while framing the assessment under section 143(3) of the IT Act, 1961, the AO made disallowance of deduction under section 10BA of the I.T. Act, 1961 (hereinafter referred to as the Act). The AO also initiated penalty proceedings under section 271(1)(c) of the Act and subsequently imposed penalty under section 271(1)(c) of the Act vide order dated 18th March, 2013. The assessee aggrieved by this penalty, filed an appeal before ld. CIT (A) who after considering the submissions, dismissed the appeal. 3. Now the assessee is further in appeal before the Tribunal. 3.1. The ld. Counsel for the assessee reiterated the submissions as are made in the written submissions and submitted that the authorities below were not justified in imposing penalty and confirming the same. The ld. Counsel submitted that merely because a claim made by the assessee was disallowed by the Assessing Aut ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ts. The addition on this account was also confirmed by the 1st Appellate Authority. The AO s case is that with the decision of Hon ble Supreme Court in the case of Liberty India vs. CIT, 317 ITR 218 the receipts on account DEPB and duty draw back can not be treated as business receipts and therefore these receipts cannot be part of profits for claim under section 10BA of I.T. Act. The AO accordingly held that by making such claim the appellant furnished inaccurate particulars of income and therefore liable to penalty u/s 271(1)(c) of I.T. Act. On the other hand the appellant case that such claim was made in bonafide manner at the time of filing of return on 23.09.2009 and that as per the existing decision of the various courts such receipts on account of DEPB and duty draw back were treated to be part of business receipts and considered eligible for deduction u/s 10BA of IT Act. It was also stated that the decision of Hon ble Supreme Court in the case of Liberty India vs. CIT, supra was delivered on 31.08.2009 and that it is only after the decision of Hon ble supreme Court, such claim is held not eligible for deduction u/s 10BA of IT Act. It is accordingly contended that when the r ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... The Hon ble Supreme Court delivered the decision on 31.08.2009 and in the judgment the Hon ble Court has very clearly held that the duty draw back receipts/DEPB benefits do not form part of the net profit of eligible industrial undertaking for the purpose of sec.80I/80IA/80IB of IT Act. Therefore, with the decision of the apex court there remained no dispute or debatable point on this issue. It may also be noted that the assessee has filed his return of income on 23.09.2009 i.e. subsequent to the decision of Hon ble Supreme Court in the case of Liberty India vs. CIT (supra) and in such return of income deduction was claimed on account of income from duty draw back/DEPB. In fact the submission of the appellant is factually incorrect in respect of the fact that the return of the income for A.Y. 2008-09 has been filed before the decision of the Hon ble Supreme Court in as msuch as the return of income has been filed after the decision of the Hon ble Supreme Court in the case of Liberty India vs. CIT, the claim of deduction on the receipts from DEPB/duty draw back was definitely not allowable. All these facts were before the appellant when the return of income was filed and knowing ve ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... were large numbers of orders at the end of the Tribunal in favour of the assesses. The issue whether deduction under s. 80-IB would be admissible on duty draw back and DEPB is still a debatable issue. There are divergent opinions on this issue by the different Hon ble High Courts. The Hon ble Delhi High court is of the opinion that deduction under s. 80-IB would be admissible on duty drawback and DEPB. In the case of Lakhvinder Singh in ITA No. 5169/Del/2004 decided on 28th Sept., 2005, then in the case of Asstt. CIT vs. Vipin Sardhana in ITA No. 5174/Del/2004 decided on 17th June, 2005 and again in the case of ITO vs. Ess Kay Enterprises, Tribunal Delhi Benches have allowed the deduction to the assessee under s. 80-IB on duty drawback. Hon ble Punjab Haryana High Court in the case of Liberty India (supra) has held that deduction under s. 80-IB would not be admissible to the assessee. The SLPs have been filed against the decisions of Hon ble Punjab Haryana High Court as well as against the decisions of Hon ble Delhi High Court in the Hon ble Supreme Court which are stand admitted as informed by the learned representative of the assessee. Thus, prima facie, it indicates that th ..... X X X X Extracts X X X X X X X X Extracts X X X X
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