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TMI Blog2019 (2) TMI 517X X X X Extracts X X X X X X X X Extracts X X X X ..... order dated 09.03.2012 passed by learned Assessing Officer ( hereinafter called "the AO") u/s 271(1)(c) of the Income-tax Act, 1961 (hereinafter called "the Act") for AY 2006-07. 2. The grounds of appeal raised by Assessee in the memo of appeal filed with the Income-Tax Appellate Tribunal, Mumbai (hereinafter called "the tribunal") read as under:- "1. On the basis of facts and in the circumstances of the case, the learned CIT(A) erred in confirming penalty of Rs. 119,731/- u/s. 271(1)(c). 2. The appellant craves leave to add, to alter, to amend, to modify or to delete any of the grounds of appeal." 3. The brief facts of the case are that assessee is a firm and is engaged in the business of Beauty Parlour. The assessee has claimed dep ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... were purchased by S.D Construction proprietary concern of Shri. Shekhar Dadarkar but however the said assets were transferred to the books of the assessee firm by way of journal entry and the assessee claimed depreciation of Rs. 27,727/-. The depreciation on the said fixed assets was disallowed by the AO and the matter went up to the tribunal and tribunal vide orders dated 29.08.2012 in ITA no. 5402/Mum/2010 for AY 2006-07 was pleased to dismiss the appeal of the assessee against quantum additions and confirm the additions as were made by the AO which was later confirmed by the Ld. CIT(A). Now the AO has invoked penalty provision u/s. 271(1)(c) of the Act and on both the issues penalty was levied by the AO to the tune of Rs. 1,19,731/- bein ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... epreciation was claimed by the said concern S.D Construction. It was submitted that the issue was decided against the assessee in quantum by Ld. CIT(A) as well as by tribunal in ITA no. 5402/Mum/2010, vide orders dated 29.08.2012 on this issue of purchase of fixed assets in the name of concern S D Construction on which depreciation of Rs. 27,727/- was claimed by the assessee . 7. The Ld. DR on the other hand relied upon the appellate order passed by the Ld. CIT(A) . 8. In rejoinder our attention was drawn by Ld. Counsel for the assessee to the Registered Agreement for transfer of office premises which is placed in paper book at page no. 27 to 44 filed by the assessee. Our attention was also drawn to valuation certificate issued by Shri. S ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the assessee for value recorded at Rs. 167.58 lakhs during impugned assessment which was based on valuation certificate and it could not be said that the said valuation is without any cause or justification , thus it led the assessee to claim higher depreciation but however for whatever reasons the said assets was transferred vide registered agreement entered into on 05.08.2006 at lower value of Rs. 92.29 lacs which led the assessee to revise its claim of depreciation downward for impugned assessment year by withdrawing claim of depreciation to the tune of Rs. 3,63,548/-. Thus under these circumstances in our considered view , the assessee has come out with bonafide explanation and under these circumstances no penalty is exigible on the ass ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sidered view that the assessee has indeed brought this asset in its books of accounts by transferring these assets to its books of accounts through journal entries. It is also claimed that the asset was used for business purposes. It could not be refuted by learned DR that the said assets were not used for business purposes of the assessee. The invoices were only drawn by vendor in the name of other concern M/s S.D.Construction and the said concern did not avail depreciation on these assets as is claimed by the assessee. Under these circumstances, we are of the considered view that no penalty u/s 271(1)(c) is exigible on the assessee and we order deletion of penalty as was levied by the AO u/s 271(1)(c) which stood later confirmed by learne ..... X X X X Extracts X X X X X X X X Extracts X X X X
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