9911796707
TMI Blog2018 (12) TMI 46X X X X Extracts X X X X X X X X Extracts X X X X ..... nalty imposable upon the assessee. 3. With the assistance of Ld.Representative we have gone through the record carefully, it emerges out from the record that assessee has filed its return of income on 29/11/2011, declaring total income of Rs. 2,54,05,015/- .Assessment order was passed u/s.143(3) r.w.s 144C on 21/03/2013. The Ld.AO has determined the taxable income of the assessee at Rs. 19,67,00,320/- after making following disallowances/additions. (a) Transfer Pricing Addition Rs. 14,94,92,409/- (b) Prior Period Income Rs. 2,60,695/- (c) Depreciation on Electrical Installation Rs. 8,502/- (d) Foreign exchange difference loss Rs. 11,27,589 (e) Disallowance u/s.14A Rs. 1.21.423/- (f) Disallowance for non deductio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... h penalty has been deleted by the Ld.CIT(A). Such additions read as under: Addition on which penalty is levied Amount of addition TP addition Rs.34,86,035/- Prior period income Rs.2,60,696/- Depreciation on electric installation Rs.8,502/- Disallowance u/s.14A Rs.1,21,423/- Disallowance u/s.40(a)(i) Rs.44,58,072/- Disallowance u/s.10B Rs.44,90,967 8. As far as appeal of the assessee is concern,he contended that an additions on account of Foreign exchange fluctuation loss claimed by the assessee was made by the AO. The issue with regard to this addition has been set aside by the Tribunal. The copy of the Tribunal's order placed on record. Thus, no penalty is imposable upon the assessee on this issue. 9. On the other h ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... l addition of Rs. 2,60,696/- (i.e Rs. 1,30,344 + Rs. 1,30,352/). In quantum appeal,Hon'ble ITAT held that PPI is to be set-off against PPE and only ''net differential sum'' is to be brought to tax. Accordingly, Net Prior period expenses have been allowed as deduction (para 22-25 @ 25, pgs. 28-30 of the order). Hence penalty deserves to be deleted. Penalty on ''Depreciation on Electric Installation -Rs.8,502/-'' Assessee claimed depreciation @ 15% of ''Electric installation''. However, AO applied depreciation rate @ 10% and made addition of Rs. 8,502/- in respect of the differential amount. Before Hon'ble the ITAT, the said ground was not pressed on account of smallness of amount (Para 38,pgs.32-33 of the order). Details of depreci ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 44,90,967/-'' Hon'ble the ITAT has deleted such disallowance made u/s. 10B of the Act (Para 61-63 @ 63 pgs.47-53 of the order). Hence penalty on the same deserves to be deleted. 11. With regard to assessee appeal, such submission read as under: AO levied penalty on addition of Rs. 11,u/s.271(1)(c) of the Act,589/- w.r.t. disallowance on account of ''foreign exchange fluctuation loss'' of Rs. 11,u/s.271(1)(c) of the Act,589/- and the same came to be confirmed by CIT(A) as well. In the quantum proceedings, Hon'ble the ITAT has set-aside the issue to the file of AO for adjudication afresh (para 39-42 @ 42, pgs. 33-37 of the order). Copy of the quantum order is annexed and marked as Annexure ''A'' to Department's appeal bearing ITA 138/ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... et off prior period expenditure. The ITAT in the quantum proceedings held that prior period income is to be set off against prior period expenditure. We have dealt with number of A.Ys and found that in certain A.Y the net balance was positive income whereas in other assessment year it was negative. Thus, on this issue it could be concluded that assessee has not concealed the particulars of income. It doesn't call for visiting the assessee with penalty. 16. Similarly, as far as disallowance u/s. 14A is concern, during the quantum proceedings we have examined this issue and observe that assessee was having sufficient interest free fund for taking care of interest expenditure relatable to earning of tax free income on the estimate basis. Adho ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
