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Commissioner of Income Tax-I, Ludhiana Versus M/s Abhishek Industries Limited, Ludhiana

Penalty under Section 271(1)(c) - whether the assessee had furnished inaccurate particulars of its income by claiming wrong deduction under Section 80IA on interest income? - Held that:- It has been categorically recorded by the Tribunal that even if it is assumed that the claim made by the assessee on the advise of Chartered Accountant was wrong, still it was not a good ground for imposing penalty under Section 271(1)(c) of the Act, as two conditions are required to be satisfied i.e. firstly th .....

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red with the findings recorded by the CIT(A) and dismissed the appeal filed by the revenue. - Decided in favour of assessee. - ITA No. 378 of 2010 - Dated:- 4-5-2017 - MR. AJAY KUMAR MITTAL AND MR. RAMENDRA JAIN JJ. For the Appellant : Mr. Rajesh Katoch, Senior Standing counsel For the Respondent : Mr. Manpreet Singh Kanda, Advocate Ajay Kumar Mittal,J. 1. The appellant-revenue has filed the present appeal under Section 260A of the Income Tax Act, 1961 (in short, the Act ) against the order date .....

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income by claiming wrong deduction under Section 80IA of the Income Tax Act, 1961 on interest income? 2. A few facts relevant for the decision of the controversy involved, as narrated in the appeal, may be noticed. The respondent-assessee is a company. It filed its return of income for the assessment year 2003-04 on 29.11.2003 declaring an income of ₹ 10,93,766/-. The assessee computed the profit under Section 115JB of the Act at ₹ 9,43,53,675 /-. The return was processed under Sect .....

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Section 115JB of the Act was recomputed and revised to ₹ 12,17,38,567/- During the course of assessment proceedings, it was inter alia noticed by the Assessing Officer that the assessee had shown ₹ 65,00,000 /- as other income in the profit and loss account of the power co-generation division of the company. This other income was nothing but interest income received by the assessee. The assessee claimed deduction under Section 80IA of the Act on this interest income. As the interest .....

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4/- vide order passed under Section 143(3) of the Act. Penalty proceedings under Section 271(1)(c) of the Act were also initiated. The assessee preferred an appeal against the assessment order before the Commissioner of Income Tax (Appeals) [CIT(A)]. Vide order dated 4.12.2006, Annexure A.III, the CIT(A) and the Tribunal vide Annexure A.IV dismissed the ground relating to claim of deduction under Section 80IA of the Act on interest income of ₹ 65,00,000/- as not pressed. Thus, it was held .....

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before the CIT(A). Vide order dated 27.02.2009, Annexure A.V, the CIT(A) deleted the penalty. Not satisfied with the order, the revenue filed an appeal before the Tribunal. Vide order dated 24.07.2009, Annexure A.VI, the Tribunal affirmed the decision of CIT(A) in deleting the penalty and dismissed the appeal filed by the revenue. Hence, the instant appeal by the appellant-revenue. 3. We have heard learned counsel for the parties. 4. Admittedly, the assessee company declared income of ₹ 1 .....

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an industrial undertaking. In appeal before the CIT(A) and the Tribunal, this ground was not pressed by the assessee and accordingly was held against the assessee. Ultimately, it was held by the Assessing Officer that the assessee intentionally furnished inaccurate particulars of income on interest income by claiming the same as deduction under Section 80IA of the Act. Case of the assessee was that on the advise of the Chartered Accountant, the claim was made by revising the return. It has been .....

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ase for addition but not for penalty. It was concluded by the Tribunal that the assessee did not furnish inaccurate particulars with the intention to conceal income and rather it made a claim on the advise of the chartered accountant which was found to be not correct. Thus, the Tribunal rightly concurred with the findings recorded by the CIT(A) and dismissed the appeal filed by the revenue. The relevant findings recorded by the Tribunal read thus:- The stand of the assessee is that on the advise .....

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if there is a wrong claim, it can de denied by Assessing Officer. It may be a good case for addition but not for penalty. As far as the argument of the learned DR that this ground was not pressed before the Tribunal, again cannot be a good ground for imposing penalty, because the assessee filed the certificate during assessment proceedings not after getting the order of the Tribunal. The decision from the Hon ble Jurisdictional High Court for claiming any deduction on the advice of the counsel .....

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it made a claim on the advise of the Chartered Accountant, which was found to be wrong. In view of these facts and judicial pronouncements, we have not found any infirmity in the impugned order, the same is upheld. 5. The findings have recorded by the Tribunal after appreciating the entire material on record and the relevant provisions of the law. In Commissioner of Income Tax Faridabad Vs. Olympia Electronics Private Limited, ITA No. 695 of 2008 decided on 21.08.2013 relied upon by the learned .....

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