TMI Blog2016 (12) TMI 1292X X X X Extracts X X X X X X X X Extracts X X X X ..... m made by the assessee which is found to be unsustainable by the Assessing Officer does not ipso-facto lead to a penalty under section 271(1)(c) of the Act as held by the Hon'ble Supreme Court in the case of CIT vs. Reliance Petroproducts Pvt. Ltd.(2010 (3) TMI 80 - SUPREME COURT ) . In our considered opinion in the present case the difference between the assessed and the reported income on the aforesaid aspect is based on varying perception of the scope of section 42(1) of the Act and it is not a case reflecting any concealment or furnishing of inaccurate particulars by the assessee within the meaning of section 271(1)(c) of the Act. - Decided in favour of assessee. - ITA No.1052/Mum/2015 - - - Dated:- 23-12-2016 - SHRI R.C.SHARMA, AM A ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nder section 143(3) and section 250 of the Act respectively. 2.3. The Ld CIT(A) has erred in ignoring the fact that contracts and service orders evidencing the nature of activities and expenditure incurred by the appellant were furnished by the appellant during the assessment and appellate proceedings, as explicitly acknowledged in the predecessor CIT(A)'s order in the quantum appeal for AY 2008-09. 2.4. The Ld CIT(A) has erred in stating that the claim for deduction under section 42(1 )(b) of the Act was not substantiated by the appellant and that only legal submissions were furnished with reference to applicability of the provisions of the Act. 2.5. The Ld CIT(A) has failed to appreciate that the fact that drilling e ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... penalty is not automatic for every adjustment made in the assessment or appellate proceedings by not accepting the claims made by the appellant during the assessment. 3. For these and such other grounds that may be raised either prior to or during the course of hearing. 2. Rival contentions have been heard and record perused. 3. In this case, AO levied penalty with regard to disallowance of deduction claimed for exploration expenditure incurred in the business of prospecting u/s.42(1). The CIT(A) confirmed the quantum addition against which assessee approached to the Tribunal and Tribunal vide its order dated 19/02/2016 set aside the matter to the file of the AO for deciding afresh after following the judgment of Tribunal in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ock and, therefore, it was a disallowable item and the Assessing Officer was justified in adding it to the returned income. As a wrong claim was made, the penalty u/s. 271(1)(c) of the Act has been rightly made. 6.3 On the contrary, the claim of the assessee has been that such expenditure represented aggregate of expenditure incurred in respect of development of oil block from which oil/gas has been found and commercial production has commenced. For the purpose of tax computation, assessee considered the actual expenses incurred as deduction which was worked out proportionately on the basis of total oil/gas reserves estimated from such blocks and the actual oil/gas produced during the year. The assessee had justified the claim of dedu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ing Officer does not ipso-facto lead to a penalty under section 271(1)(c) of the Act as held by the Hon'ble Supreme Court in the case of CIT vs. Reliance Petroproducts Pvt. Ltd.(supra). In our considered opinion in the present case the difference between the assessed and the reported income on the aforesaid aspect is based on varying perception of the scope of section 42(1) of the Act and it is not a case reflecting any concealment or furnishing of inaccurate particulars by the assessee within the meaning of section 271(1)(c) of the Act. Therefore, on this aspect of the matter also we find no error on the part of CIT(A) in deleting the penalty levied by the Assessing Officer under section 271(1)(c) of the Act. 5. It is clear from t ..... X X X X Extracts X X X X X X X X Extracts X X X X
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