TMI Blog2016 (11) TMI 454X X X X Extracts X X X X X X X X Extracts X X X X ..... as not been disproved. It may be that it does not have much tax effect in assessee’s case, therefore, assessee has not pursued the litigation, but as the facts indicate assessee’s contentions that the same value was shown in work-in-progress and the addition is a double addition have not been invalidated. Considering these, we are of the opinion that these two amounts certainly does not fall in the category of concealment of income and therefore, penalty cannot be levied on the above two amounts. - Decided in favour of assessee Disallowance of 80-IA - Held that:- Assessee has acquired the property earlier in 01-04-1992 and the EMC Electronik unit was set up in AY. 1992-93. It was submitted that it has complied with all the conditions of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... #8377; 4,04,675/- and also made certain additions pertaining to sale of PCBs of ₹ 30,569/- and also certain closing stock in finished goods ₹ 3,10,802/-. Even though assessee contested the same in the appeal, he withdrew the contentions with reference to additions whereas the Ld.CIT(A) allowed the deduction u/s. 80-IA. In the appeal by Revenue, ITAT vide its order dt. 30-03-2007, reversed the order of the CIT(A) and affirmed action of AO in disallowing the claim u/s. 80-IA. Since proceedings u/s. 271(1)(c) were initiated on 13-02-1997 when assessment was completed, AO completed the proceedings by levying penalty u/s. 271(1)(c) on the above three items. 3. Before the Ld.CIT(A), assessee contested that mere disallowance of 80-I ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... undisclosed without considering that the value of work in progress included a value for the same; 4. The Honourable Commissioner of Income Tax (Appeals)-IV erred in passing an order confirming the levy of penalty u/s. 271(1)(c) on the disallowance of deduction u/s. 80(IA) even though it was allowed in appeal by the CIT(A)-V and disregarding the aspect of disallowance being made only on the basis of interpretation of the facts on record pertaining to newly established industrial undertaking in respect of which sum claim was made; Ground No. 5 is general in nature. 4. Ld. Counsel submitted that as far as the additions made by AO are concerned : i. Item of ₹ 30,569/- was in fact accounted in the next year and referred to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d perused the documents on record. As far as two additions are concerned, it is the fact that sales recorded in the next year have been brought to tax during the year based on the entries in the RG1 Register. It is also fact that AO has reduced the same value in AY. 1995-96. 7.1. With reference to three Shock Pulse Analysers, the AO on verification of RG1 Register noticed that they are available in the closing stock, whereas assessee contends that the stock was part of work-in-progress in the books of account. It is interesting to note that Ld.CIT(A) recorded the facts as under: 3.1. During the assessment proceedings, the Assessing Officer noticed on verification of RG1 Register that the appellant had sold 140 PCBs for a sum of S ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e awaiting assembling and packing before dispatch and that the disclosure in RG1 register was only made to avoid adverse comments from Excise Depot. 4.3. The Assessing Officer observed that the items under work-inprogress were those items which had not been fully processed or completed and that only finished goods had to be entered in RG1 Register and the appellant had shown these items as finished goods in the RG1 register. The Assessing Officer, therefore, levied penalty on the appellant on this issue . 7.2. As can be seen from the above, we are unable to understand on what basis penalty is levied as AO invoked both concealment of income as well as furnishing inaccurate particulars. As seen from the above facts as recorded by ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... aim u/s 80-IA was allowed by the Ld.CIT(A) after due examination by him. On further appeal by Revenue, ITAT however, has not allowed the claim. This shows that it is mere rejection of a claim. Mere disallowance of a claim does not come within the purview of concealment of income . It can also do not form under the category of furnishing of inaccurate particulars . Hon'ble Supreme Court in the case of CIT Vs. Reliance Petro Products [322 ITR 158] has held as under: We have already seen the meaning of the word particulars in the earlier part of this judgment. Reading the words in conjunction, they must mean the details supplied in the return, which are not accurate, not exact or correct, not according to truth or erroneous. We mu ..... X X X X Extracts X X X X X X X X Extracts X X X X
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