TMI Blog2018 (2) TMI 1633X X X X Extracts X X X X X X X X Extracts X X X X ..... etails are filed to examine. In these circumstances, we are unable to come to a conclusion whether it is a bonafide claim or deliberate claim to avoid payment of tax u/s. 115JB. The order of Ld.CIT(A) does not throw any light on these aspects. Devoid of facts, the case law cannot be applied. It is trite law that the case law will apply only based on facts in which it was rendered. In the absence of discussion or examination of facts, it is not possible to adjudicate only on principles of law. In view of that, we hereby set aside the order of AO and CIT(A) on this issue and restore the issue to the file of AO to consider the same afresh on the issues stated above and give clear findings. - I.T.A. No. 1654/HYD/2014 - - - Dated:- 16-2-2018 - ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nvested ₹ 28.31 Crores in its sister concerns on 31-03-2010. It was also noticed that assessee claimed ₹ 79,85,452/- towards payment of interest on loans during the year. Assessee was asked to explain the sources of the above investments and to show cause why the proportionate claim of interest on loan should not be disallowed u/s. 14A. Assessee replied that the sources for these investments are nothing but adjustment of due amounts from the sister concerns. It was also mentioned that no borrowed loans were utilized for the purpose of investment in the above companies. But the AO did not accept the contention of assessee as it failed to substantiate its claim that no borrowed funds were utilized for the purposes of investment in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o have not considered the same and levied penalty on both the amounts at 30%, even though the tax on 115JB was calculated at 15%. There was an excess levy of ₹ 1,17,02,781/-. 4. Before the Ld.CIT(A), assessee filed detailed reply contending (a) that there was excess penalty levied; (b) that the explanation of assessee dt. 31-07-2013 was not considered; (c) that penalty was levied on both disallowances/additions under normal computation as well in computation u/s. 115JB; (d) that the mere disallowance does not warrant levy of penalty. It relied on various case law. 5. Ld.CIT(A) has not addressed the contentions at (a), (b) and (c) but deleted the penalty holding as under: 5. I have carefully considered the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... claimed the expenditure, which claim was not accepted or was not acceptable to the revenue, that by itself would not attract the penalty u/s 271(1)(c). If the contention of the revenue is accepted, then in case of every return where the claim is not accepted by the AO for any reason, the assessee will invite penalty u/s 271(1)(c) and held that is clearly not the intention of the legislature. It was held that a mere making of the claim, which is not sustainable in law, by itself, will not amount to furnishing of inaccurate particulars regarding the income of the assessee. Such claim made in the return cannot amount to inaccurate particulars . 5.2 In this connection, it would also be relevant to quote the following case-laws which is o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... g officer, the penal provision is not automatically attracted. The penal provision is applicable only if the enhancement is on account of some income with the assessee is found to have earned and concealed. ( vi) The decision of the Delhi High Court in the case of CIT vs. AT T Communications Services India Pvt. Ltd., reported in 343 ITR 257m (Delhi). ( vii) The decision of the Delhi High Court in the case of CIT vs. Nokia India Pvt. ltd., reported in 343 ITR 434(Delhi) ( viii) The decision of the Hon'ble Supreme Court in the case of Price Waterhouse Coopers (P) Ltd., vs. CIT reported in 348 ITR 306(SC). ( ix) The decision of the Delhi High Court in the case of CIT vs. Brahmaputra Consortium Ltd., reported ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Circular No. 25/15 has accepted the legal position and instructed the officers vide the circular dt. 31-12-2015, but the same was not before AO at the time of finalising the penalty. Even though contention was raised, Ld.CIT(A) has not adjudicated the same. 8.1. As far as levy of penalty on addition u/s. 14A is concerned, the same does not arise as the computation of income under normal provisions was less than the tax computed u/s. 115J. As per the Board Circular referred, the penalty is not warranted on this amount. Hence, to that extent, the action of AO cannot be accepted. 8.2. Coming to the issue of penalty on the addition made under the provisions of Section 115JB, we are unable to examine whether the claim was deliberate or no ..... X X X X Extracts X X X X X X X X Extracts X X X X
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