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TMI Blog2018 (9) TMI 468X X X X Extracts X X X X X X X X Extracts X X X X ..... days. The assessee in the application for condonation of delay explained that due to illness of the Managing Director of the assessee-company, the impugned order could not be sent to the concerned Advocate for filing the appeal, which is supported by Medical Certificate. The assessee-company, therefore, prayed that the nominal delay in filing the appeal may be condoned. 3. After considering the rival submissions and explanation of assessee-company, we are satisfied that assessee-company was prevented by sufficient cause in not filing the appeal within the period of limitation. The nominal delay in filing the appeal is, therefore, condoned. 4. Briefly the facts of the case are that during the year under consideration, the assessee-company ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... regards the travelling expenses, disallowed 5% of the total expenses against 25% of the disallowance made by the A.O. and restricted the disallowance to Rs. 1,10,800/-. The Ld. CIT(A), however, confirmed the disallowance of 25% of expenses out of Business Promotion and confirmed the addition of Rs. 3,94,696/-. 6. The A.O. initiated the penalty proceedings on both the above additions and levied the penalty vide separate order. The Ld. CIT(A) deleted the penalty with regard to addition made on account of disallowance of travelling expenses. However, Ld. CIT(A), confirmed the levy of penalty on account of disallowance of business promotion expenses in a sum of Rs. 3,94,696/-. The assessee-company is in appeal to challenge the levy of penalty ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ness of the assessee-company. The expenses are incurred on food, tea etc., for which, necessary documentary evidences are available on record. The cash payments are made in 73.13% and rest of 26.87% expenses are incurred through banking channel. The Ld. CIT(A), therefore, noted that cash payment have been made by assessee-company and there are certain expenses incurred to show occasional gifts to the Doctors and other staff in various hospitals. There are bills to show purchase of laptop, for which, no rationale have been explained. The Ld. CIT(A) also noted that three expenses of Rs. 15,000/-, Rs. 11,500/- and Rs. 18,800/- are incurred to follow-up the tender in Armed Forces medical material supply Depot. The Ld. CIT(A) applying the Explan ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is a case of disallowance of part of the expenses which have been incurred consistently by assessee-company in earlier years as well. Therefore, it is not a fit case for levy of the penalty. It is well settled Law that levy of penalty is not automatic in each and every case. It depends upon the facts and circumstances of the case. The disallowance of part of the expenses without bringing specific material against the assessee-company on record, it is not a case of concealment of income or filing inaccurate particulars by the assessee-company. We, therefore, do not find any justification to sustain the penalty under section 271(1)(c) of the I.T. Act, 1961. We, accordingly, set aside the orders of the authorities below and cancel the penalty. ..... X X X X Extracts X X X X X X X X Extracts X X X X
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